METALS-Base metals mixed as investors assess demand outlook, supply uncertainty

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Recasts, updates prices, adds China holiday) BEIJING, April 4 (Reuters) - Prices of base metals were mixed on Tuesday as a gloomy economic outlook and renewed inflation fears sparked demand worries among investors, while supply uncertainty also weighed on the market. Three-month copper on the London Metal Exchange moved 0.4% higher at $8,948 a tonne by 0821 GMT. Prices of the metal used in power, construction and new energy sectors have gained 5.2% from a two-month low seen in mid-March.


Analysts at Guotai Junan Futures said the current prices have subdued some spot buying, although demand from air conditioning sector has been strong.


Meanwhile, they noted the orders by the State Grid failed to meet expectations, new orders in the solar industry slid, and that for wire and cable contracted.


The most-traded May copper contract on the Shanghai Futures Exchange closed day trading 0.4% lower at 69,080 yuan a tonne. SHFE trading on Tuesday evening and Wednesday will be closed due to the Qingming holiday in China.


Investor sentiment was also hampered by China's factory activity, which lost momentum in March amid still-weak export orders.


That said, analysts from ANZ research noted Chile, the world's largest copper producer, posted its lowest production in six years.


"State-owned firm Codelco warned its output woes of 2022 will only get worse this year as it strives to revive its aging operations following years of under-investment," they added.


Among other metals, LME aluminium was down 0.5% at $2,386 a tonne, tin eased 0.2% to $25,980, zinc shed 0.6% to $2,881, nickel moved down 0.1% to $23,350, while lead nudged up 0.2% to $2,119. Traders were also watching for any possible further production disruptions in the southwestern China's Yunnan province, where local aluminium producers have been asked to cut power usage due to tight hydro-power supply.


SHFE aluminium eased 0.1% to 18,675 yuan, zinc declined 0.8% to 22,450 yuan, lead dipped 0.1% to 15,205 yuan, tin slid 0.8% to 203,880 yuan, and nickel lost 0.8% to 176,860 yuan a tonne. For the top stories in metals and other news, click or ($1 = 6.8814 Chinese yuan) (Reporting by Siyi Liu and Dominique Patton; Editing by Subhranshu Sahu and Uttaresh Venkateshwaran)


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