The London Metal Exchange has reported a drop in the price of copper as Greek economy fears and lower than predicted purchases by the Chinese cause price crash. The speculation has left the price of the metal at 5723.00 US dollars per ton today, with the last month seeing a low of 5,642.50 US dollars per ton on Monday 22nd June.
Wood Mackenzie analysed the issue in February and cited numerous worldwide social and economic factors as key to the slump in price that has been taking place since the start of this year: ‘The fall in the oil price at the end of 2014 was clearly the initial trigger, compounded by the collapse of the Russian rouble, slowing growth in China, Japanese recession, the Greek elections and further signs of weakness within the European economy.’
Greece, a major importer of copper, has been holding tough negotiations on the repayment of their vast debts and faces problems with staying in the European Union, leaving them with an uncertain economic future. Another major factor could be the strike at Chile’s copper mine Collahuasi, with workers caught in a fierce dispute with the mine’s managers over working conditions.
China, a global force in the imports market, reduced their importing of copper, with many speculating that this was due possibly to necessary smelting machinery maintenance. The acquisition of Las Bambas copper mine in Peru, which is held in majority by Chinese state owned firm Minmetals, highlights China’s commitment to the purchase of the metal and its use in construction, but recent predictions expect them to produce more copper than expected in a new contract with MMG.