Comex copper review on 31 May

On Wednesday, copper futures on the Chicago Mercantile Exchange (COMEX) fell for a second day. Concerns about global growth and Chinese demand have prompted continued selling by speculative bears.

By the close, futures were down 2.4 cents to 2.7 cents, with the most actively traded July 2023 copper at $3.6455 a pound, down 2.4 cents or 0.71 percent from the previous close.

Copper for July delivery traded in a range of $3.6395 to $3.666.

Copper futures for May delivery fell 6.18%, the biggest one-month decline since June 2022 and the second consecutive monthly decline. Copper fell 11.54% in April and May.

Copper prices have given up all of their 2023 gains, mainly because of weak demand in the US and Europe, as interest rate hikes by central banks such as the Federal Reserve weigh on economic growth; Weaker than expected economic demand from China has recently dampened hopes for growth.

The dollar rose Wednesday, putting pressure on metals quoted in the greenback. The ICE Dollar Basket Index for June closed at 104.245, up 0.16 percent from Tuesday and up 2.8 percent for the month.

The recent COMEX copper contract is down 4.59 per cent year to date, 16.14 per cent from the same period last year and 26.33 per cent below the all-time peak set in March 2022.

Copper fell 14.6 per cent for 2022 on COMEX as concerns about the global growth outlook and high inflation prompted central banks in the US and Europe to aggressively raise interest rates to combat inflation, raising the risk of a recession. In contrast, copper has posted back-to-back 25 percent gains in 2020 and 2021, as a green transition in the global economy and electrification help boost additional demand for the metal, which is widely used in the power and construction industries, while copper faces disruptions such as underinvestment and production disruptions.

On Wednesday, copper for July 2023 delivery, the most actively traded contract on the Shanghai Futures Exchange, closed down 10 yuan at 64,810 yuan a ton. Bonded copper futures for August 2023 on the Shanghai International Energy Trading Center (INE) fell 30 yuan to 57,330 yuan a metric ton.

COMEX copper futures traded 75,971 lots on Wednesday, compared with 103,117 lots in the previous session; Empty volume stood at 223,185 lots, compared with 220,057 lots in the previous session.