(Bloomberg) -- Copper halted gains as traders weighed demand concerns in China, the world’s largest consumer of the metal.
Futures declined as much as 1.5% on the London Metal Exchange — trading near a five-month low — after advancing the previous three sessions.
“The outlook in China remains challenging,” especially given the lackluster real estate market, said Ewa Manthey, commodities strategist at ING Bank NV in London. In addition, “the manufacturing sector looks weak globally, indicating a sluggish demand recovery for copper and other industrial metals.”
Typically a significant net importer of copper, China has seen weak local consumption drive record exports in recent months. LME data this week showed Chinese output accounted for the bulk of inflows onto the exchange in July.
LME inventories rose again Tuesday after three days of outflows. The so-called Yangshan premium — a measure of copper demand in China — retreated for a second day, after rebounding for four straight weeks.
Prices held declines even after workers went on strike at the world’s biggest copper operation. Union members at BHP Group’s Escondida mine in Chile downed tools over pay, setting the stage for a major disruption.
Three-month copper futures traded down 0.7% at $8,967.50 a ton as of 3:45 p.m. in London. Other base metals also fell, with zinc dropping 1.9% and lead sliding 2.5%.
--With assistance from Sana Pashankar.
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