Copper hits one-month low after smelter cuts premium
Commodity Online | October 17 2016
UPDATED 10:43:39 IST

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The price of copper slipped to a one-month low on Friday after the dollar gained and Europe's biggest smelter cut the premium it will charge customers for copper cathode next year, highlighting over-supply and weak demand.

Germany's Aurubis will offer 2017 copper cathode to customers at a premium of $86 a tonne to the LME average cash price, down 6.5 percent from a premium of $92 this year, the company said on Friday. The Aurubis premium highlights some of the woes that bedevil the sector. It's further evidence that things are still pretty soggy in the real world and it's difficult for the market.

Another sign of the plentiful supply in the market was a 13 percent rise in copper inventories in warehouses monitored by the Shanghai Futures Exchange. The strong dollar and yesterday's weak Chinese data are also applying downside pressure to the LME. While poor Chinese trade data on Thursday fuelled concerns about demand in the world's top metals user, some of those fears eased on Friday when producer prices in China unexpectedly rose in September for the first time in nearly five years.

Courtesy: Religare