Copper price hits highest level in 6 weeks after floods in China

Benchmark copper on the London Metal Exchange was up 0.9% at $9,604.50 per tonne in official trading, after touching its highest since June 16 at $9,665.

Click here for an interactive chart of copper prices

Floods in central China, especially in the industrial and transport hub city of Zhengzhou in Henan province, have raised supply concerns and demand for rebuilding damaged infrastructure.

Flooding has caused at least $10 billion in damage, according to state media.

“Sentiment has brightened again in the last few days, reflected in the copper price,” Commerzbank analyst Daniel Briesemann said, adding he believed copper was due for a correction.

A Singapore-based trader said the market was pricing in disruptions to output from floods in Henan and demand for reconstruction.

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Copper prices advanced in the last few days as China revealed that will release fewer metals reserves than expected.

China will sell another 30,000 tonnes of copper, 90,000 tonnes of aluminum, and 50,000 tonnes of zinc at auction from its state reserves on July 29.

The auction marked the second sale by China this month as the government aims to rein in skyrocketing commodity prices.

“It is slightly less than the market expected but it should be priced in already as it’s pretty well flagged,” said Anna Stablum, a commodities broker at Marex Spectron.

(With files from Reuters)

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