The Zhitong Finance App learned that traders are more optimistic about the interest rate outlook and assessed the impact of a fatal mining disaster in Chile on the supply side, increasing the increase in copper prices. Copper prices rose 0.6% on Monday. The fall in oil prices has heated up market expectations that the central bank may suspend further interest rate hikes to curb energy-driven inflation. Meanwhile, investors are still weighing the geopolitical risks brought about by the escalation of hostilities in the Middle East, and await the release of US inflation data in the middle of the week. Higher borrowing costs often weaken the appeal of commodities that do not generate returns.
In Chile, the giant El Teniente copper mine owned by the Chilean National Copper Company (Codelco) was hit by an avalanche on Sunday, killing two workers. Open pit operations at the mine had previously been suspended due to bad weather. Codelco confirmed that the two workers killed were both affiliated with the subcontractor San Lorenzo, and that outdoor work had been suspended due to bad weather at the time of the incident. This was the second fatal accident at the mine in months, after an avalanche in July killed five workers.
This supply setback comes at a time when industrial metals are facing trade mismatches and growing global demand. China's inventory is still low after a week-long holiday, and an import demand index rose to a four-year high last week, indicating that buyers in the world's largest copper consumer may be replenishing their stocks.
In the first half of the year, the total output of the world's 15 major copper mining companies fell 2.90% year on year. Among them, Chilean production fell 6.6%. Frequent accidents at major mines such as El Teniente and Escondida compounded the decline in ore grade, which posed a major drag.
As of press release, copper prices on the London Metal Exchange rose 0.79% to $14,642 per tonne, with a cumulative increase of nearly 2% over the past week. The price of aluminum remained stable, while the price of zinc fell by 0.81%.