Mr. Alireza Moghaddam, Chairman, AMIDT Group
New Delhi, May 26, 2017: China’s economic data is key to copper prices. Copper prices slipped due to weak imports from its top consumer China to a four-month low. Benchmark copper on the London Metal Exchange was down 0.3 percent at $5,497 a tonne at 0911 GMT. Earlier it fell to $5,481.50 towards Monday’s $5,462.50, the lowest since Jan 4.
Chinese imports of copper collapsed more than 30 percent in April from a month ago to 300,000 tonnes. A higher U.S. currency also weighed on sentiment as it makes dollar-denominated metals like copper more expensive for holders of other currencies, which potentially could subdue demand.
Moreover there are more Copper inventories in warehouses as compared to previous months. Supply of copper scrap has tightened recently after growing in the first quarter, while disruptions at major mines earlier in 2017 are hitting availability.
Along with China, Japan, India, South Korea and Germany are other largest importers of copper. The Indian economy has the highest growth rate of 7% in the world and this is expected to cross 8% in the near future. All developmental and infrastructure projects, industrial production of cars, electronics, IT, Telecom and other sectors will see a rise in demand for copper. Along with China, India will play a major role in shoring up the demand for copper in the coming years.
All the above stated scenarios mean cheaper copper for the Indian infrastructure industry. As the Indian Elephant rumbles on, cheaper copper prices mean more expenditure by the private and the government sector across industries.
Even though demand from China is key in controlling the prices of metals, this can be easily be offset by demand from countries like India. As the Indian economy grows, sectoral spending across sectors will go up, thereby creating a new demand bank for copper. Copper being the base metal for any developing economy, cheaper availability will mean a higher demand. . For India, fall in Chinese demand for copper is a boon for its growth.
India with its tremendous potential can control metal prices as China slips. China still consumes half of world’s metals but this figure is on the decline. Countries like India can easily replace China if proper policies are implemented and executed by the Indian government.
Corporate Comm India (CCI Newswire)
