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Copper prices fell on Tuesday as a tumbling iron ore market weighed on trader sentiment, while caution ahead of key central bank meetings due this week pressured the metal used to gauge global economic health.
Three-month copper on the London Metal Exchange was down 0.9% at $9,470 a tonne, as of 0721 GMT, while the most-traded December copper contract on the Shanghai Futures Exchange closed down 0.8% at 69,660 yuan ($10,887.61) a tonne.
The most-traded Dalian iron ore futures were near a one-year low on steel production controls and sluggish downstream consumption, accelerated by a debt crisis at property giant China Evergrande Group.
Copper is widely used in construction, manufacturing and power, making it a good indicator for global economic health.
The trading volume was thin as market participants were waiting for more cues from a U.S. Federal Reserve meeting on interest rates, which could impact economic growth and liquidity in the financial markets.
“The dramatic drop in iron ore and the upcoming Fed meeting causes a few people to stay side-lined so volumes are pretty thin across base metals,” commodities broker Anna Stablum of Marex Spectron said.
“Sentiment onshore is not great. Property is definitely a concern,” Stablum said.
FUNDAMENTALS
* Top copper miner Codelco offered Chinese customers annual copper supply for 2022 at a premium of $105 a tonne, up 19.3% from $88 a tonne this year, extending a trend of higher premiums on strong copper demand and very low inventories.
* LME aluminum fell 0.6% to $2,703 a tonne, nickel dropped 1.3% to $19,455 a tonne and zinc shed 0.7% to $3,332.50 a tonne.
* ShFE aluminum edged up 0.2% to 20,095 yuan a tonne, zinc dropped 2.1% to 23,605 yuan a tonne and tin advanced 0.1% to 272,600 yuan a tonne.