Copper prices climbed to their highest level in about a week

Investors celebrate further eases in the coronavirus closings in significant economies, especially Europe. Along with other industrial metals, copper prices jumped today. 

The spot price of copper rose 1.72% on the London Metal exchange. The metal posted its highest level since April 30, while three-month futures gained 0.4% to $5,218.50 a ton.

China’s demand recovery for the manufacturing material supported metal prices. The country posted an unexpected rise in the overall exports in April.

The most-traded June copper contract on the Shanghai Futures Exchange was up 0.5 % at 42,760 yuan ($6,025.85) a ton by the midday break.

Helen Lau, an analyst of metals and mining at Argonaut Securities based in Hong Kong, said that the rebound in prices mostly follows a continuous recovery in Chinese demand and overseas supply stress.

Lou also mentioned that Chinese exports in April supported the market. The export data was better than expected. However, she thinks that an increase in purchases of medical equipment and other items might have boosted the shipments. 

Compared to 2019, China’s April exports increased by 3.5%. It marked the first positive growth since December 2019. 

The country’s copper imports climbed by 4.3% in April from the previous month. It was boosted by an economic recovery from the coronavirus outbreak and favorable prices.

Trade tensions overshadow the metal profits

However, gains in copper were overshadowed by boiling trade tensions between China and the US. 

Helen Lau thinks that demand for Chinese commodities will be feeble while the coronavirus pandemic persists.

US President Donald Trump stated on Wednesday that he would be able to tell in a week or two whether China was fulfilling its obligations. Trump indicated China’s increase in US goods purchases under the Phase 1 trade deal.  

The two countries signed the Phase 1 trade deal in January before the coronavirus spread globally. Under the agreement, China agreed to increase its purchases of US goods over two years, with around $77 billion in increased investments in the first year and $123 billion in the second. However, the coronavirus crisis halted the country’s economy and blew Chinese demand sharply. It is only beginning to recover now. 

The coronavirus pandemic has infected more than a million people in the US. Mike Pompeo, the US secretary of state, declares that the epidemic emerged from a laboratory in China.