Copper prices set to remain subdued amid demand concerns

Shanghai Futures Exchange (SHFE) copper prices climbed slightly on Tuesday September 30, the last trading day before the week-long National Day holidays, which began on October 1. The SHFE closed for a week from Wednesday for the holiday.

The most-traded copper contract for December ended at 48,030 yuan ($7,802) per ton on September 30, up 390 yuan or 0.82 percent from September 29. The copper price was up 300 yuan on September 30 from the previous Tuesday, September 23.

The trading volume declined by 45,034 lots on Tuesday September 30 from Monday's 328,692 lots.

Copper futures kicked off on September 22 at a low level, partly because investors were keeping a cautious attitude ahead of the week-long holidays, according to a report from Shanghai CIFCO Futures Co on September 29.

But economic data from HSBC helped to support market sentiment and eased investors' worries over the outlook for the Chinese economy, according to a report on September 30 by chinanews.com.

China has launched supportive policies to encourage the sluggish property market. The People's Bank of China and China's banking regulator announced on September 30 that the requirements for first-time homebuyers would be relaxed.

The policy move is "a healthy development for China's property market and should help arrest the slowdown in growth momentum," said a report e-mailed to the Global Times by Australia and New Zealand Banking Group on October 1.

During recent months, concerns about China's demand for copper and the strength of the US dollar have been weighing on copper prices, according to a report from Reuters on September 29.

"Copper is in a downtrend at the moment and we can see that persisting for a little while longer, based on the strength of the US dollar and concerns that have been reignited over Chinese demand," the report quoted analyst Tim Radford at Sydney-based advisor Rivkin as saying.

China's economy is still facing pressure, so copper prices are likely to decline further during the short term, according to a report from Shenzhen-based Jinrui Futures Co on September 30.