The global economy recovered from the epidemic, triggering “catch-up” demand, pushing copper prices to soar to high levels, exceeding $10,000 per ton for the first time in 10 years. China, the world’s largest copper consumer, is suffering from the opposite, causing factories to be unable to deliver and other situations that could hinder the pace of economic recovery.
According to an industry survey conducted by the mainland media, mainland wire manufacturers have been faced with idle equipment, delayed deliveries, and even defaulted on bank loans. End-users such as power grids and real estate developers have also been delaying deliveries, while producers of copper products have also noticed a drop in orders.
Analysts believe that buyers of copper did not expect this round of price increases, with wire producers being hit the hardest and smaller plants keeping output rates low as high prices slowed investment in the power grid.
China’s manufacturing and services PMI indices both fell in April on a monthly basis, indicating that the economy is still recovering but at a slower pace. The official manufacturing PMI fell from 51.9 to 51.1 in April, below market expectations.
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