According to Macquarie’s Vivienne Lloyd, an estimated 600,000 to 890,000 tons of copper sit in bonded warehouses inside custom zones, or 4% of global supply. However, 600,000 tons are held by those who can endure the credit squeeze or those who will physically use the metals, which leaves about 290,000 tons, or 1.3% of supply that could affect global supply, reports Abheek Bhattacharya for the Wall Street Journal.
Standard Chartered also reassured markets that it is not pulling out of its commodity financing commitments in China.
“The fundamentals remain strong … and we think any kind of sell-off could be a buy opportunity in the longer term,” Aslam added.
iPath Dow Jones-UBS Copper Total Return Sub-Index ETN
For more information on the copper market, visit our copper category.
Max Chen contributed to this article.