(Recasts, adds China factory data, updates prices)
BEIJING, March 15 (Reuters) – Copper prices struggled to find momentum on Wednesday, as subdued China factory data weighed on demand hopes, although the likelihood of a smaller rate hike by the U.S. Federal Reserve provided some support.
Three-month copper on the London Metal Exchange was unchanged at $8,835.50 a tonne by 0449 GMT, while the most-traded April copper contract on the Shanghai Futures Exchange advanced 0.8% to 68,810 yuan ($9,996.66) a tonne.
China’s factory activity in the first two months expanded slightly slower than expected, suggesting the bruised economy still needed time to fully emerge from COVID damage.
Property investment in the January-February period fell again, as home buyers and developers remained cautious despite a slew of supportive government policies. That raised some doubts over the pace of demand recovery for industrial metals.
“There’s typically a one-year lag between property sector and copper demand, which means the actual consumption might not largely pick up till the end of this year,” a Shanghai-based copper producer said.
Rio Tinto’s head of copper Bold Baatar said on Tuesday the short-term outlook for copper is “pretty healthy”, with global stockpiles trending down and mine disruptions eroding supplies from Latin America.
Mining exports from Peru, the world’s second-largest copper producer, dropped 19.8% in January, compared with a year-ago period, the sector’s business chamber said on Tuesday, in the wake of devastating protests that have rocked the country in recent months.
Data showed that U.S. consumer prices rose at an expected monthly pace in February, raising bets of a smaller 25 basis-point hike in key interest rate from the Fed meeting next week.
LME aluminium was down 0.4% at $2,343.50 a tonne, tin nudged 0.1% up at $22,965, zinc gained 0.3% to $2,919.50, and lead advanced 0.8% to $2,101.50.
SHFE aluminium rose 0.3% to 18,340 yuan a tonne, nickel was flat at 177,950 yuan, lead added 0.3% at 15,270 yuan, and tin climbed 0.5% to 187,100 yuan, while zinc dipped 0.3% to 22,825 yuan.
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