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July 1st, 2005
- No Change
Shanghai - Copper futures drop further despite strong fundamentals
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LME data showed copper stocks fell 1,025 metric tons to 30,250 tons Tuesday, and further declines were expected, as 8,600 metric tons is under cancelled warrant and awaiting removal. Copper futures in Shanghai fell for a second day on signs consumers have slowed buying for the third quarter, when demand for copper rods and tubes typically falls. European and North American factories close in July and August, reducing demand for pipes and wires from Chinese producers. Cash copper prices in Shanghai fell as much as 1.4 percent Wednesday as processors bought less metal. ``The third quarter is, traditionally, a slow season for consumption of copper rods and other similar products,'' said Huang Xiaotian, general manager of the copper department at Golden Dragon Precise Copper Tube, China's biggest copper tube maker. Copper for September delivery fell 440 yuan, or 1.3 percent, to close at 32,360 yuan (HK$30,389.28) a tonne on the Shanghai Futures Exchange when trading ended at 3.00pm local time. It had fallen as much as 690 yuan, or 2.1 percent, to 32,110 yuan. Huang declined to comment on whether Golden Dragon will buy less refined copper in the third quarter. Falling cash copper prices in Shanghai also reflect concerns supply may be easing in China, said Gu Yuan, who trades metal futures at Shenzhen Star Futures. This follows ``traders' reports that more imports may have arrived this week,'' he said.
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