Coronavirus hits copper price

By DALE LUMA
THE threat of the coronavirus in the Asian market, particularly in China, has caused copper prices to fall sharply, says OK Tedi Mining Ltd chief executive officer Peter Graham.
“The copper price is broadly related to supply and demand and when supply exceeds demand, the price is under pressure,” he said. “However, economic uncertainty also has an impact on the copper price.
“The Chinese economy is particularly important for copper price since China accounts for more than 40 per cent of global copper consumption.
“Copper price averaged around US$6,000 (KK20,000) per tonne in 2019.
“In late 2019, the copper price rallied after a phase one trade deal was agreed to between US and China, but this optimism deteriorated in January 2020.
“The US missile strike that killed Iranian Maj-Gen Qassem Soleimani saw prices decline by 3 per cent on the day.
“As Middle East tensions eased, and the phase one deal was signed, sentiment turned positive again and the copper price hit a high of more than US$6,300 (K21,420) per tonne the day after the trade deal was signed.
“When reports of the coronavirus emerged, copper price declined sharply, falling 12 per cent to a low of US$5,566 (K18,924) per tonne given the likely threat of the virus on economic growth in Asian markets and particularly China.
“The key unknown in the first quarter of 2020 is the impact of the new coronavirus.”
Graham said the outlook for production at Ok Tedi in 2020 was around 100,000 tonnes of copper metal and 330,000 ounces of gold.