Copper futures decline, amid concerns over China, Ukraine

Copper futures on the Shanghai Futures Exchange (SHFE) fell by 9.3 percent week-on-week, according to a report Friday by London-based metal information provider Metal Bulletin, mainly due to panic selling amid concerns over China's economic growth and heightened tensions in Ukraine.

The most-traded copper contract for delivery in May declined by 0.25 percent on the SHFE on Friday compared to Thursday, ending at 44,380 yuan ($7,216.85) per ton. The trading volume fell by 296,000 lots Friday.

Copper is expected to remain sluggish in the short term as inventories in the domestic market are high and demand is still weak, according to a report by Xinhua News Agency last week.

In addition, Shanghai Chaori Solar Energy Science and Technology Co failed to pay the interest on a loan due on March 7. This was the first-ever default in China's corporate bond market.

The fall in copper futures in China was mirrored by international markets, with the benchmark three-month copper contract on the London Metal Exchange declining to $6,376.25 per ton Wednesday, its lowest price since July 2010.

"Markets are watching what is happening in copper with awe and trepidation," Kit Juckes, head of currency strategy at Societe Generale, was quoted as saying in a report by Reuters last week.

"It's partly ongoing concern about Chinese growth [or the lack thereof] and nagging worries about Ukraine. And partly it is just that the commodity bubble burst last year and not everyone noticed," Juckes said.