Copper futures slid for a fifth day on Monday on concern that a probe at Qingdao Port will reduce demand for the metal as data showed that Chinese imports dropped in May.
Chinese imports of copper dropped 15.6% from April to 380,000 tonnes in May, according to official customs data released over the weekend. A separate report released showed that the nation’s exports rose higher than expected to 7% in May from 0.9% seen in the previous month. Companies cut back on their copper orders in May following the large shipment quantities in April.
“There is a lot of excess supply for industrial metals. We need enough demand to absorb that supply before we get back, probably late this year, into a more bullish market condition,” Rob Haworth from YS Bank Wealth Management said.
The contract for delivery in three months retreated 0.7% to $6,642 a metric ton on the London Metal Exchange at the time of writing, while Copper stockpiles tracked in Shanghai, New York and London fell 47% lower this year, the lowest since 2008.
Futures for the commodity for July delivery lost 0.6% to $3.0315 per pound in New York. Copper for delivery in August slid 1.8% lower, closing at $7,594 a ton on the Shanghai Futures Exchange.
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The metal was dragged lower by concerns over the ongoing investigation at Qingdao Port will cut demand for the commodity. Qingdao Port is looking at whether copper stocks were used as collateral loans. Traders in China are selling copper holding in the physical market, according to SMM Information & Technology based in Shanghai.
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