2014.07.2503:24:07UTC+00Copper marks first drop for the week

Prices for copper fell for the first time this week behind healthy global supplies and investor sentiments that its recent rally was excessive.

Futures for the metal with a delivery date in three months dropped by 0.3% to $7,150 per metric ton late morning Tokyo time today. Prices on the London Metal Exchange (LME) climbed 1.8% yesterday to its highest value since May 12th of $7,175. Copper has made a 2.4% advance this week, but has so far declined 2.8% for the year to be worst performer among the LME’s six major metals.

Goldman Sachs Group Inc says that supplies of the metal in warehouses around the world will surpass this year’s demand by 353,000 tons and grow further to 492,000 tons in 2015. The financial services firm says that increasing output of copper from China, its top user, as well as a weakening property market in the country will push prices down to $6,200 per ton within 12 months.

Research general manager for Nihon Unicom Inc Hiroyuki Kikukawa says that, “The outlook for a global surplus and a bearish forecast from the International Monetary Fund for China’s growth depressed the market.” The IMF recently revised down its growth forecasts for Asia’s largest economy this year from 7.5% to 7.4% and next year from 7.3% to 7.1%.

Futures for copper in September on New York similarly declined by falling to 0.3% to $3.2565 per pound, but climbed by 0.2% on the Shanghai Futures Exchange to $8,189 per ton.

Other metals on the LME such as nickel dropped, while aluminum and lead advanced.