MARKET TALK: High Copper Prices May Hurt Chinese Demand

There are growing signs that copper inventories may increase in China, particularly if re-stocking is slowing and even reversing, says John Meyer at Numis. The high price of copper may encourage Chinese consumers to reduce their demand and survive on lower stock levels, he adds. However, if copper prices fall substantially, then stock building activity may quickly resume, limiting the extent of the downturn, says Meyer. LME copper trades at $7,809/ton, down 1% from Thursday.