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Copper price rises as markets assess omicron variant impact

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The copper price rose on Monday, recouping some of last week’s losses fuelled by the newly identified coronavirus variant, with markets trying to gauge its severity and its possible impact on economic recovery.

Copper for delivery in March was up 2% on the Comex market in New York, touching $4.38 per pound ($9,636 per tonne). 

The most-traded January copper contract on the Shanghai Futures Exchange fell 1.2% to 70 230 yuan a tonne, tracking Friday’s sell-off in London.

The World Health Organisation warned that deciding the severity level of the omicron variant could take “days to several weeks” in the absence of information that its symptoms differed from those of other variants.

The variant has been detected in Australia, Britain, Canada, Germany and Hong Kong after it was identified first in South Africa.

Meanwhile, a South African doctor said symptoms of the new virus variant were so far mild and could be treated at home.

“If the variant raises severe concerns, this could delay financial tightening, which would be favourable for industrial metals,” said ANZ analyst Soni Kumari, adding inventories and supply constraints were still be supportive in the short-term.

“Copper is still very tight, due to low stocks on LME and supply has not completely recovered and so prices could hold up fairly well even if economic growth slows,” said Amelia Fu, Head of Commodity Market Strategy at Bank of China International.

(With files from Reuters)