Copper on MCX settled down -0.95% at 381.70 as supply fears eased and more stocks arrived into LME sheds. Copper in yesterday's session dropped below 380 level at one point of time after solid U.S. jobs data increased the likelihood of an interest rate hike this month and on signs that a disruption at the world's biggest copper mine may soon ease. While London Metal Exchange copper fell 1.1 percent to $5,701 a tonne after ending a tad lower in the previous session.
The metal earlier touched $5,688, its lowest since Jan. 19. Last month Supply fears had helped propel the copper price above $6,200 per tonne, but these fears have faded this week. Freeport Indonesia aims to resume copper concentrate production on March 21, according to Reuters. Meanwhile, there is talk that BHP Billiton is looking to use “contract workers” to resume production should the Escondida dispute continue beyond 30 days.
Meanwhile, data released this week showed a significant drop in China’s copper imports. In February, China imported 340,000 metric tons of copper, down 10.5% from January and 19% from last February. Also, from last Thursday through this Wednesday stocks of copper at LME approved warehouses nearly doubled to reach 288,525 tons. Most of the deliveries were to warehouses in Asia.
On the demand side, a trade deficit in China for February has reinforced the growing view that economic activity in China picked up in the first two months of the year, adding to a global manufacturing revival. Now technically market is under fresh selling and getting support at 378.6 and below same could see a test of 375.5 level, And resistance is now likely to be seen at 384.9, a move above could see prices testing 388.1.