Cooper Metals – METALS-Copper falls as China property woes trigger demand fears
(Updates prices, adds quotes)
Oct 6 (Reuters) – Copper prices in London slipped on Wednesday as demand worries grew over the possibility of more debt defaults by Chinese property developers.
Cash-strapped China Evergrande Group has soured risk sentiment on worries of a wider financial crisis and a potential drag on Chinese construction activities, which consume a large amount of metals.
“Fantasia Holdings Group was the latest Chinese developer to fall into crisis after failing to repay a maturing bond. This adds to strains of the nation’s heavily leveraged property firms following Evergrande’s debt woes,” ANZ analysts said in a note.
A firmer dollar, fuelled by nervousness that surging energy prices could spur inflation and interest rate hikes, also made greenback-priced metals more expensive to holders of other currencies.
Three-month copper on the London Metal Exchange fell 1.1% to $9,069 a tonne by 0620 GMT, aluminium eased 0.3% to $2,912.50 a tonne, nickel declined 0.4% to $18,055 a tonne while lead rose 0.4% to $2,161 a tonne.
Also adding pressure was an easing supply disruption threat in Peru, the world’s second-biggest producer of mined copper.
Peru’s government said on Tuesday it had reached an agreement with MMG Ltd’s Las Bambas mine and a local community to avoid road blockades that have threatened production at the huge copper mine.
Trade was tepid as China is on holiday from Oct. 1-7.
* Brazilian miner Vale SA said on Tuesday the production of copper concentrate at its Salobo mine is suspended due to a fire affecting a conveyor belt.
* LME cash nickel was at a $11.50 premium over the three-month contract CMNI0-3, indicating tight nearby supplies as inventories fell in global exchange warehouses.
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Reporting by Mai Nguyen in Hanoi; Editing by Krishna Chandra Eluri and Ramakrishnan M.