By Eileen Soreng
Dec 20 (Reuters) – Copper prices fell on Monday, as a rapid spread of the Omicron coronavirus variant fuelled concerns over its impact on economic activity, while the dollar held firm.
Three-month copper on the London Metal Exchange CMCU3 fell 0.5% to $9,390 a tonne, as of 0450 GMT, while the most-traded January copper contract on the Shanghai Futures Exchange SCFcv1 shed 0.6% to 68,870 yuan ($10,798.06) a tonne.
“Recent news from few countries on Omicron cases are bringing caution to market. Risks include further lockdowns on spread of Omicron and how it impacts demand or production operations,” said Wong Min Hao, a commodities manager with Phillip Futures.
The Netherlands went into a lockdown on Sunday, while several other European governments considered additional curbs to control the spread of the highly contagious variant.
The dollar hovered near the three-week peak hit last week, after a U.S. Federal Reserve official signalled that the first interest rate hike could come as early as March. USD/
A stronger dollar makes the greenback-denominated commodity more expensive for those holding other currencies.
Among other industrial metals, LME aluminium CMAL3 fell 0.5% to $2,710 a tonne, nickel CMNI3 dropped 0.7% to $19,510 a tonne, lead CMPB3 was down 1.7% at $2,268.5 a tonne and tin CMSN3 eased 0.4% to $38,275 a tonne.
FUNDAMENTALS
* On-warrant LME-registered copper stocks MCUSTX-TOTAL eased to 80,550 tonnes, while the premium for LME cash copper over the three-month contract MCU0-3 was at $30 a tonne, highest in two weeks.
* Inventories in Shanghai Futures Exchange warehouses fell to 34,580 tonnes last week, its lowest level since June 2009.
* ShFE aluminium SAFcv1 gained 1% to 19,680 yuan a tonne, nickel SNIcv1 rose 0.4% to 145,090 yuan a tonne, lead SPBcv1 fell 1.9% to 15,360 yuan a tonne and tin SSNcv1 was 0.7% lower at 282,540 yuan a tonne.
* China’s aluminium imports have hit an annual record high this year with a month to spare, customs data showed on Saturday, as restrictions on power usage by domestic smelters underpin demand for overseas metal.
* China’s output of alumina, which is smelted to make aluminium, fell in November by 4.5% year-on-year to its lowest in 18 months, official data showed on Friday, as regions impose curbs on the aluminium raw material, while production of both lead and zinc was the highest since December last year.
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($1 = 6.3780 Chinese yuan renminbi)
(Reporting by Eileen Soreng in Bengaluru; Editing by Vinay Dwivedi and Rashmi Aich)
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