Copper fell to a two-week low on Friday, and its weekly performance headed for the biggest drop in 18 weeks, on concerns about the Chinese property sector and an outlook for increased production.
Benchmark copper on the London Metal Exchangewas down 1.38 percent at $6,996.50 a tonne at 1451 GMT, having touched a session low of $6,962 a tonne, its weakest since July 2. Copper has dropped nearly 3 percent this week, the biggest weekly drop since mid-March.
China's new home prices fell in June from May for a second straight month, and analysts forecast the falls would continue.
Also, an expected copper surplus in the second half of this year has contributed to price concerns. Evidence of plentiful supplies emerged on Friday when data showed weekly copper inventories in Shanghai warehouses rose by 28.9 percent.
Several companies also increased their guidance for output this week. Rio Tintoincreased full-year production guidance for copper. Anglo American Plc also reported higher copper output for the first half of the year.
The increase comes despite supply-side setbacks this year in leading producers including Indonesia, Zambia and Chile.
"Given this wide range of problems on the supply side, one might have expected global copper supplies to have dropped quite sharply," Nic Brown, head of commodities research at Natixis, told the Reuters Global Base Metals Forum.
"It is testament to the strength of the new pipeline of supply that mine output in the year to date has probably risen by 4 percent or more (year on year)."
DEMAND CONCERN
China's Huatong Road & Bridge Group said on Wednesday that it might not be able to repay a $65 million debt due next week, possibly becoming the first borrower to default in the country's largest bond market.
"We are increasingly worried about China's property market. New dwelling commencements are down 18.6 year on year in the first five months, the sharpest decline since 2009," analyst Matt Fusarelli of AME Group said.
In the United States, consumer sentiment dipped in early July while an index of consumer expectations weakened for a third straight month.
Aluminiumtraded at $1,976.75 a tonne, down 0.62 percent following a strong rally over five consecutive sessions this week. The metal touched a 16-month peak on Wednesday at $1,993 a tonne.
Nickeltraded at $18,600 a tonne, down 3.13 percent and having earlier hit its lowest since late June. Traders were downbeat about its prospects given rising stocks and a 38 percent gain already this year.
Also a drag on nickel, an Indonesian mining official said the country had resumed exports of metal ore concentrates, ending a six-month stoppage. Prior to the stoppage, Indonesia was the world's top exporter of nickel ore.
The focus next week will be on a flash reading of China's manufacturing health, as well as U.S. inflation, new home sales and durable goods orders.
Source: Reuters
Benchmark copper on the London Metal Exchange
China's new home prices fell in June from May for a second straight month, and analysts forecast the falls would continue.
Also, an expected copper surplus in the second half of this year has contributed to price concerns. Evidence of plentiful supplies emerged on Friday when data showed weekly copper inventories in Shanghai warehouses rose by 28.9 percent.
Several companies also increased their guidance for output this week. Rio Tinto
The increase comes despite supply-side setbacks this year in leading producers including Indonesia, Zambia and Chile.
"Given this wide range of problems on the supply side, one might have expected global copper supplies to have dropped quite sharply," Nic Brown, head of commodities research at Natixis, told the Reuters Global Base Metals Forum.
"It is testament to the strength of the new pipeline of supply that mine output in the year to date has probably risen by 4 percent or more (year on year)."
DEMAND CONCERN
China's Huatong Road & Bridge Group said on Wednesday that it might not be able to repay a $65 million debt due next week, possibly becoming the first borrower to default in the country's largest bond market.
"We are increasingly worried about China's property market. New dwelling commencements are down 18.6 year on year in the first five months, the sharpest decline since 2009," analyst Matt Fusarelli of AME Group said.
In the United States, consumer sentiment dipped in early July while an index of consumer expectations weakened for a third straight month.
Aluminium
Nickel
Also a drag on nickel, an Indonesian mining official said the country had resumed exports of metal ore concentrates, ending a six-month stoppage. Prior to the stoppage, Indonesia was the world's top exporter of nickel ore.
The focus next week will be on a flash reading of China's manufacturing health, as well as U.S. inflation, new home sales and durable goods orders.
