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New York - Copper’s on the verge of becoming the only major metal to post a loss this year as the highest stockpiles in almost seven months suggest the market is amply supplied.
Inventories of copper, used in everything from wiring to automobiles to iPhones, rose 4.7% to 240 075 metric tonnes, according to London Metal Exchange data, the highest since January 29.
After rising as much as 9.1% by March, copper has now lost almost all its gains in 2016 as investors anticipate supply will outpace demand. It’s the worst performer among the six major metals traded on the LME.
"Increasing inventories is never a good thing for prices," Mike Dragosits, a senior commodity strategist at TD Securities in Toronto, said in a telephone interview. "The muddling along in the Chinese growth certainly doesn’t say great things about copper, which we think is a bit of an oversupplied market at this point."
Copper declined 0.8% to settle at $4 710 a tonne ($2.14 a pound) on the LME, in the longest stretch of losses in two weeks. The metal is up 0.1% this year.
Traders will remain cautious of any gains in copper, as LME inventories have increased and there’s little evidence that buyers have stepped up purchases ahead of the autumn peak season, Jia Zheng, a trader with Soochow Futures, said by phone from Shanghai.
In other metals:
Copper futures for December delivery fell 1.2% to $2.126 a pound on the Comex in New York. On the LME, lead, aluminum, zinc and tin rose, while nickel was unchanged.
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