Copper (and aluminum) tumbled overnight as base metals were battered during an intense Asia session and losses are extending in European trading. As one trader noted "sentiment toward China is weak, the dollar is somewhat strong and there is an unholy combination of many factors keeping prices under pressure," and copper traded $4,999/mt on the LME - its first sub-$5000 print since 2009. Aluminum, nickel and zinc all tumbled also.
Copper back at lows not seen since 2009...
And the last few days have seen losses accelerate...
As Bloomberg reports,
The plunge in copper means almost one in five mines globally is losing money, Macquarie Group Ltd. said Monday. Some mines, especially in China, will have to cut supply or close if prices stay so low, analysts led by Vivienne Lloyd wrote.
While disruptions in mining have reduced supply, it’s not been enough to support prices. Copper producers are likely to miss production targets by up to one million tons this year, according to Commerzbank’s Weinberg.
“This should provide a cushion for prices, but in reality it doesn’t,” he said. “The market seems much more concerned about the demand side. It’s very much about the sentiment of the market and that has been quite bad.”
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low commodity prices must be unequivocally good for America, right?