Industrial metals fell back on Tuesday after a collapse in oil prices rattled markets and convinced traders that global demand destruction for commodities may be worse than feared.
Copper trading in New York fell by 7.3% to $2.1495 a pound ($4,740 a tonne) in early afternoon trade, a three-week low. Last month, the bellwether metal briefly traded below $2.00, levels last seen during the global financial crisis of 2008-2009.
Weakness in the copper price came despite early signs that activity in top metals consumer China is beginning to return to normal.
Reuters reports copper stockpiles in warehouses overseen by the Shanghai Futures Exchange fell to 303kt from a four-year high above 380kt last month. Inventories in Chinese bonded warehouses also dipped.
While Chinese refined copper output in March fell by 2.5% year-on-year to 771kt, the lowest since May last year, production over the first quarter was up slightly from Q1 2019.
Chinese smelters also pumped out more zinc (+4.7%) and lead (+2.2%) in March than the same period last year.
Price drops on the LME were more subdued – aluminium was down by nearly 1% at $1,490 a tonne, zinc fell 1.7% to $1,914, nickel slipped 2.3% to $12,225, lead lost 1.5% to $1,663 and tin declined 2.5% to $14,840.