LONDON, June 16 (Reuters) - Copper prices bounced on Wednesday after touching their lowest in more than seven weeks as analysts said that China’s release of some of its metals stockpiles may be modest in copper.
Three-month copper on the London Metal Exchange had gained 1.1% to $9,671 a tonne by 1600 GMT after earlier touching its weakest since April 23 at $9,489 and slumping by 4% on Tuesday.
China announced plans on Wednesday to release copper, aluminium and zinc in batches from its national reserves to curb commodity prices.
The government did not specify volumes, but Citi said copper volumes were likely to be minimal.
“The reason why copper has rallied in the first place has not gone away, but we may have a mismatch between the price action relative to the actual pickup in demand,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.
Copper touched a record peak of $10,747.50 last month, having surged nearly 40% since the year began as speculators bet on rising demand from a green transformation.
“This is a buying opportunity, the only question is when are we going to see the bottom and turnaround,” Hansen added.
* The Yangshan copper premium SMM-CUYP-CN fell to $21 a tonne, its lowest since February 2016 and 81% lower than May 2020, indicating weak demand for imported metal.
* LME on-warrant copper inventories MCUSTX-TOTAL rose to their highest in a year at 130,925 tonnes.
* China’s exports of aluminium have likely peaked in the wake of a series of trade protection moves in key markets around the world, consultancy CRU said.
* LME aluminium added 0.1% to $2,469.50 a tonne and lead rose 1% to $2,198 while zinc dipped 0.1% to $3,025.50, nickel shed 0.4% to $17,665 and tin lost 0.4% to $31,345.
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Additional reporting by Mai Nguyen in Hanoi Editing by Jane Merriman and Alistair Bell