The price of copper is trending upwards again, as China’s release of stockpiled metals proved smaller than expected.
Copper’s value gained 1.7% overnight, after it tumbled last week.
However, at the time of writing, it has fallen 1.15% since 10am this morning. This leaves it 0.23% higher than it was this time yesterday.
Currently, a tonne of copper is valued at US$9,376.75 on the London Metal Exchange.
How ASX copper shares are performing today
Like the copper price, ASX listed large-cap copper shares have been bouncing around today amid wider market falls.
The ASX 200’s only pure-play copper company, Oz Minerals Limited (ASX: OZL) has spent a decent portion of today in the green, despite currently having slipped into negative territory. The Oz Minerals share price opened lower this morning before jumping more than 1% to an intraday high of $22.95. At the time of writing, however, the company’s shares are trading 0.75% lower at $22.55.
Meanwhile, shares of Sandfire Resources Ltd (ASX: SFR), the second-largest ASX copper producer by market capitalisation are rising today. Right now, the Sandfire Resources share price is trading 1.63% higher than its previous close.
What’s driving the price of copper?
According to reporting by South China Morning Post, China will sell 20,000 tonnes of copper from its reserves to the market. The metal will go to auction online on 5 July and 6 July.
The news seems to have bolstered confidence in copper, as the market apparently expected a larger amount of the red metal to be released.
This is Beijing’s latest attempt to curb a surge in commodity prices. It will also be releasing 50,000 tonnes of aluminium and 30,000 tonnes of zinc, also to be auctioned.
As The Motley Fool has previously reported, China consumes 50% of the world’s refined copper. If China were to release large amounts of copper from its stockpiles, global demand for the commodity would likely wane and its price would fall as a result.
The price of copper has gained around 21% since the start of 2021. It has also fallen roughly 12% since it hit its record high price of US$10,746 per tonne in May.
The price of commodities – including copper – fell recently after the US Federal Reserve indicated that interest rates could rise sooner than anticipated, strengthened by the US dollar. At the same, rumours of China’s plans to release stockpiled metals were swirling.