Copper price bounces on news about fresh investment in China

Copper for delivery in March rose 2.4% on the Comex market in New York, touching $3.83 per pound or $8,426 per tonne.

China’s southern manufacturing hub of Guangzhou plans 1,722 projects in 2023 worth more than 6.5 trillion yuan ($945 billion), state media CCTV reported on Thursday.

“Knowing what the year will bring after two days of trading is virtually impossible, so there’s quite a lot of caution regarding getting too stuck with a position that may not end up being the right one,” said Ole Hansen, head of the commodity strategy at Saxo Bank in Copenhagen.

“If you started out having a handsome profit on a breakout, then a fundamental piece of supportive news is enough for those sellers to have a rethink.”

Prices are unlikely to make much progress on the upside, however, with underlying concern about rising covid-19 cases in China and weakening global industrial activity, he added.

The most-traded February copper contract on the Shanghai Futures Exchange dropped as much as 1.8% to 63,850 yuan ($9,289.98) a tonne on Thursday, its lowest since Nov. 4, 2022.

Global copper smelting dips
Global copper smelting activity dipped in December as smelters shut for maintenance after a year of sluggish activity, data from satellite surveillance of metal processing plants showed on Thursday.

China’s Yunxi plant began an annual maintenance program at the start of the month, while Codelco’s Chuquicamata smelter in Chile remained closed, according to a joint statement from commodities broker Marex and SAVANT.

Global smelting activity for 2022 fell to its lowest level in the six-year history of data from SAVANT, the satellite analytics service Marex launched with Earth-i.