Copper yesterday settled up by 0.13% at 789.3 amid a weak dollar, expectations of elevated demand, and persistent concerns of low supply. Strong credit growth in China underscored Chinese authorities’ goal of stimulating infrastructure construction. In the meantime, data from the London Metal Exchange showed inventories fell to 56,000 tonnes, the smallest amount since 2005. The development tracked stocks at the Shanghai Futures Exchange, which lost over one-third since their peak in February. To add, Chile’s state-owned Codelco said the output in 2023 is estimated to sink as much as 7% after the 10.6% decline in 2022.
Depleting stocks worldwide drove key commodity trader Trafigura to forecast copper prices at a record high this year. Meanwhile, supply and demand imbalances led Goldman Sachs (NYSE: GS ) to project a global shortage of visible copper inventories by September. China's copper imports fell 19% in March from a year earlier, customs data showed, as domestic production climbed and higher global prices restrained interest. Imports of unwrought copper and copper products totaled 408,174 tonnes in March, according to data from the General Administration of Customs. The purchases, which included anode, refined, alloy, and semi-finished copper products, compared with imports of 504,009 tonnes in March 2022.
Technically market is under short covering as the market has witnessed a drop in open interest by -1% to settle at 3367 while prices are up 1.05 rupees, now Copper is getting support at 784.6 and below the same and could see a test of 779.7 levels, and resistance is now likely to be seen at 796.5, a move above could see prices testing 803.5.
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