Copper Hits 11-Month High on Supply Concerns

  • Copper
    (${instrument.percentChange}%)

Copper Analysis

Top China copper smelters have jointly agreed to cut production levels according to Reuters and the news sent prices to the highest levels in nearly a year [1]. Although no specific figures were announced, the report comes at a period of broader supply concerns.

Anglo American for example, one of the world's biggest miners, expects production to drop around 4% this year [2]. First Quantum forecasts a more than 40% decrease [3] and has halted production in its biggest site (Cobre Panama), due to court ruling [4]. On the demand side, the clean energy transition and prospects of a recovery in the chip industry due to AI, can put upwards pressure.

Having hit the highest point in eleven months, Copper now has 4.196 in its crosshair, but we remain cautious around further gains. With RSI at overbought conditions, a pullback would be reasonable.

However, daily closes below the EMA200 (at around 3.860) that would halt the bullish momentum, would need a strong catalyst. Chinese miners may have agreed to output cuts, but demand may sag, as the economic recovery has been uneven and the property sector remains in distress.

Nikos Tzabouras

Senior Financial Editorial Writer

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 13 Mar 2024 https://www.reuters.com/markets/commodities/chinas-top-copper-smelters-agree-production-cut-amid-raw-material-tightness-2024-03-13/

2

Retrieved 13 Mar 2024 https://www.angloamerican.com/media/press-releases/2023/08-12-2023

3

Retrieved 13 Mar 2024 https://www.first-quantum.com/English/announcements/announcements-details/2024/First-Quantum-Minerals-Reports-Fourth-Quarter-and-Year-End-2023-Results/default.aspx

4

Retrieved 29 May 2024 https://www.first-quantum.com/English/announcements/announcements-details/2023/First-Quantum-Provides-Update-on-Cobre-Panama/default.aspx

${getInstrumentData.name} / ${getInstrumentData.ticker} /

Exchange: ${getInstrumentData.exchange}

${getInstrumentData.bid} ${getInstrumentData.divCcy} ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%) ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%)

${getInstrumentData.oneYearLow} 52/wk Range ${getInstrumentData.oneYearHigh}
Disclosure

Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.

Past Performance: Past Performance is not an indicator of future results.

Spreads Widget: When static spreads are displayed, the figures reflect a time-stamped snapshot as of when the market closes. Spreads are variable and are subject to delay. Single Share prices are subject to a 15 minute delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays, or for actions relying on this information.