METALS-Copper buoyed by US-China trade talk optimism, falling stocks

By Pratima Desai

LONDON, June 9 (Reuters) - Copper prices rose on Monday as optimism about U.S.-China trade talks and falling inventories offset weak export data from top consumer China, which also imported less copper in May.

Benchmark copper CMCU3 on the London Metal Exchange (LME) was up 1% at $9,787 a metric ton at 1615 GMT. Last week, it touched $9,809.5 a ton, the highest since March 31, on worries about mine supplies and lower stocks in LME approved warehouses.

LME data shows copper stocks fell 10,000 tons on Friday to 122,400 tons MCUSTX-TOTAL, a drop of more than 50% since February. Cancelled warrants or metal earmarked for delivery show another 67,800 tons is due to leave the LME system.

Traders say much of this metal is heading towards the United States, where prices HGC1 are significantly higher due to the potential threat of U.S. tariffs on copper imports.

Three of U.S. President Donald Trump's top aides met with their Chinese counterparts in London on Monday to resolve a trade dispute that has kept global markets on edge.

"Growing pressure on the Trump administration to end its 'tariff tantrum' and offer the business community an element of certainty should also be constructive for commodities," said Marex analyst Edward Meir.

China's export growth slowed to a three-month low in May as U.S. tariffs hit shipments, while its copper imports of unwrought copper and copper products fell 16.9% year on year and 2.5% month on month to 427,000 tons in May.

Part of this is to do with copper flows to the U.S., but traders said Chinese demand was also weaker due to the impact of tariffs on its manufacturing sector.

The Yangshan copper premium SMM-CUYP-CN, a gauge of China's appetite to import copper, fell to $41 a ton last Friday, a three-month low. It peaked at $103 in early May, the highest since mid-December 2023.

Overall, industrial metals were supported by a lower U.S. currency, which makes dollar-priced commodities cheaper for users of other currencies.

Aluminium CMAL3 rose 1.2% to $2,480 a metric ton, zinc CMZN3 slipped 0.5% to $2,651, lead CMPB gained 0.3% to $1,989, tin CMSN3 climbed 1.1% to $32,710 and nickel CMNI3 ceded 0.5% to $15,405.

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