CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

Industrial metals rebound on bullish long-term demand

By Fitri Wulandari

04:59, 16 December 2021

A worker at a steel plant in Kosice, US
Most base metals prices rebounded in Asia on Thursday supported by optimism over long-term demand – Photo: Shutterstock

Most base metals prices rebounded on Thursday in Asia trading supported by optimism over long-term demand despite China’s subdued economic data and the Federal Reserve’s hawkish monetary policy.

Copper on the London Metal Exchange advanced 1.98% to $9,381.50 per tonne, while US copper futures rose by 1.23% to $4.23 per pound. Aluminium advanced 1.24% to $2,631.25/tonne; tin rose 0.92% to $38,502.5/tonne; and zinc gained 0.97% to $3,316.25/tonne. Nickel rose 1.52% to $19,380/tonne.

Prices of most industrial metals dropped on Wednesday after a slew of China’s data signalling slowing economic growth, clouding demand for the metals. China’s retail sales, an indicator of consumer spending in the world’s most populous country, grew by 3.9% in November, slowing from an increase of 4.9% in October, the National Bureau of Statistics announced on Wednesday.

Long-term demand

Ahmad Zuhdi, analyst at the Office of Chief Economist at Jakarta-based Bank Mandiri, told that since most economies in metal-consuming countries are still recovering, any negative sentiment could knock metals prices.

“However, prices will tend to rebound because overall (metals) demand is still high. Market still optimistic for long-term that metals will be the core of renewable energy development. Therefore, demand for nickel, copper, aluminium and other will still increase,” Ahmad added.

According to a study commissioned by the International Copper Association (ICA), increases in solar and wind energy will raise copper demand by 813,000 tonnes annually by 2027, a 56% increase on 2018 levels. The International Nickel Study Group (INSG) in October forecast global primary nickel usage will increase to 3.04 million tonnes in 2022, from estimated 2.77 million tonnes in 2021. 

INSG expects the electrification of vehicles will continue to have a positive impact on nickel usage through the use of nickel sulphate in batteries.


0.68 Price
+3.710% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.01168


44,150.40 Price
+1.670% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 22:00 (UTC)
Spread 106.00


16,080.90 Price
+0.500% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 7.0


2,004.85 Price
-1.180% 1D Chg, %
Long position overnight fee -0.0198%
Short position overnight fee 0.0116%
Overnight fee time 22:00 (UTC)
Spread 0.50

Copper disruption

Copper was also supported by the announcement from copper miner MMG on Thursday that it will shut production at its Las Bambas mine in Peru, the world’s second copper miner, from 18 December, which may squeeze supply in market.

The decision came after the wholly owned subsidiary of Guoxin International Investment could not reach an agreement with local Peruvian who had blocked the mine’s transport road.

MMG estimated that until 18 December, production is estimated at 290,000 tonnes of copper concentrate. Stockpiles on site are now approximately 60,770 tonnes of copper in concentrate, it added

Prices can go up further

Also on Wednesday, the US Federal Reserve (Fed) announced plans to double the pace of its bond purchase programme or tapering, putting it on a path to zero out new purchases by March 2022, from an initial plan in June. But Fed chair Jerome Powell said the US central bank would not raise rates until the taper process concludes. It means rate hike decision may come as early as March next year or in May.

Ahmad said from the tapering process to the actual rate hike, metal prices can still go upward but in slower pace.

Read more: Copper price analysis: Will 4.00 hold after the death-cross?


Rate this article

The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

Still looking for a broker you can trust?

Join the 570.000+ traders worldwide that chose to trade with

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading