Copper Weakens on Year-End, But Poised for a Strong Finish in 2024 After 2023
Forex - The three-month copper prices on the LME fell on the last day of the year but are on track to achieve a second consecutive annual gain. At the London Metal Exchange (LME), three-month copper declined by 0.45% to $8,870 per metric ton at 14:20 GMT, but gained 3.7% for the year.
Aneeka Gupta, Director of Macroeconomic Research at WisdomTree, stated, “Disruptions in global mining supplies have contributed to tightening in the global copper market. On the demand side, prices have been supported by industrial recoveries in major economies and demand stemming from the transition to green energy.”
In May, copper prices reached a historical peak of $11,104.50, partly due to a frenzy of fund buying. However, since then, prices have fallen by approximately 20% under pressure from a strong dollar, threats of import tariffs, and ongoing skepticism regarding China’s recovery.
China, the largest consumer of commodities, is struggling to recover due to weak consumption and a prolonged property crisis. However, policymakers hope that the recent fiscal and monetary measures will trigger a turnaround.
Tim Waterer, Chief Market Analyst at KCM Trade, commented, “The uncertainty regarding the scope and consequences of potential trade wars under the new Trump administration could cast a shadow over industrial metal demand. If the negative trend in the Chinese economy continues into 2025, it could negatively impact copper prices.”
LME aluminum fell by 0.1% to $2,549 per ton, but with the help of raw material shortages, it rose by 7% this year. Prices for alumina, the primary raw material used in primary aluminum production, have increased this year due to supply disruptions.
LME zinc decreased by 0.2% to $3,012.50, up 13.3% for the year. Tin dropped by 0.6% to $29,130, marking a 14.5% annual increase.
LME nickel rose by 0.1% to $15,430, while lead increased by 0.3% to $1,953.50. The metals recorded annual losses of 7.4% and 5.7%, respectively.