The copper price fell sharply on Thursday as the supply squeeze on the London Metal Exchange (LME) eased and attention refocused on the threat of slowing demand in top consumer China.
Copper for delivery in December fell 3.39% on the Comex market in New York, touching $4.5745 per pound ($10,063 per tonne), despite news that the world’s largest publicly traded copper miner produced less copper than expected.
Freeport-McMoRan produced 987 million pounds of metal in the third quarter, with the output falling short of the 1 billion pounds average estimate of analysts tracked by Bloomberg.
Copper prices jumped to a new high last week as stockpiles hit a 47-year low.
On-warrant copper stocks in LME-registered warehouses at 18,250 tonnes remain near multi-decade lows.
Exchange stocks represent a fraction of available material and sudden tightness on the LME does not reflect the wider market, said Julius Baer analyst Carsten Menke.
“We are seeing a loosening in the copper market,” Menke said, pointing to rising mine and scrap supply and slowing demand in China, which is suffering power shortages and weakening economic growth.
“Prices should be lower at the end of the year.”
(With files from Reuters and Bloomberg)