The industrial metals ETP redemptions this month equaled to about 12% of their market capitalization, more than any commodity group. In contrast, investors funneled $101.3 million into industrial metals over the first seven months of the year, the best percentage increase of any commodity group, as supply concerns in southeast Asia and improving U.S. demand fueled market optimism.

However, the outlook changed after the International Monetary Fund cut its global growth forecast. Meanwhile, Macquarie Group argued that supplies of copper, lead, tin and nickel will all be in surplus.

Specifically, China remains the main threat to industrial metal demand where growth is expected to slow to 7.4 this year, its slowest pace since 1990. Additionally, fears of another Eurozone recession is also weighing on the industrial demand outlook.

PowerShares DB Base Metals Fund

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Max Chen contributed to this article.