Copper price down despite supply scarcity concerns

Codelco El Teniente smelter in Chile. (Credit: Consejo Minero)

Copper prices fell on Tuesday despite worries about shortages.

Copper for delivery in December was down 0.6% on the Comex market in New York, touching $4.37 per pound ($9,614 per tonne) on Tuesday afternoon.

[Click here for an interactive chart of copper prices]

“The market is concerned about lack of supplies going forward,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

“These key metals are desperately needed not only in the green transformation push but in these infrastructure plans that are being unveiled.”

The $1 trillion US infrastructure bill passed last week will fund bridge and highway repair, new broadband and public transportation projects and a network of electric-vehicle charging stations across the country.

The price was also capped by worries about the ongoing property crisis in China, Hansen said.

Chinese developer Kaisa told a Chinese government think-tank it needs help to pay investors, workers and suppliers after the real estate sector was hit by a liquidity squeeze.

The real estate sector accounts for a large share of copper consumption and China is the world’s biggest user of the red metal.

Energy shortages in China and electricity price hikes in Europe also posed risks of reduced demand from metal users.

(With files from Reuters)