Within financial markets, “Doctor Copper” refers to the idea that the price of the metal can be used as a barometer for the health of the world economy.

So ingrained is the substance in our everyday lives – used in everything from construction and electronics to power transmission and more – that its price is a good bellwether for how well things are going.

China is already the world’s largest producer and consumer of the metal, and it is tightening its grip on the industry.Credit: Bloomberg

To look at copper over recent months, you’d think the world is on the up. The price of the metal has risen by nearly a tenth over the last six months.

But what this rally may in fact be pointing to is something quite different: China tightening its grip on supplies.

Inventories usually grow around Lunar New Year at the end of January as Chinese smelters keep working through the holiday period but many factories reduce their operations.

However, the seasonal build-up has been the most pronounced since 2020. Stockpiles jumped from 30,905 metric tonnes at the end of December to 285,090 tonnes by the end of February.

Imports also rose over the same period despite the large build ups in warehouses.

The trend has caught the eye of market observers because of the importance of copper to the green economy.

QOSHE - How China got its claws into the West’s green transition - Eir Nolsoe
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How China got its claws into the West’s green transition

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29.03.2024

Within financial markets, “Doctor Copper” refers to the idea that the price of the metal can be used as a barometer for the health of the world economy.

So ingrained is the substance in our everyday lives – used in everything from construction and electronics to power transmission and more – that its price is a good........

© The Sydney Morning Herald


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