Chile Commodities

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Chile: Copper prices recover slightly in September from six-year low

October 1, 2015

Concerns over a slowdown in China, an appreciating U.S dollar and increased commodity supply triggered a sell-off in major commodities, including copper. Prices for copper and oil, but also for gold and other raw materials, have seen fresh lows recently and copper prices reached a six-year low in August. However, in September prices recovered slightly, rising 1.7% over the previous month to an average of USD 2.37 per pound (equivalent to USD 5,128 per tonne). The reading represented a first monthly increase after three consecutive declines. In August, copper prices recorded a 6.0% monthly drop.

September’s slight recovery came on the back of several factors, including expectations that China’s recent cut in the sales tax on small cars will lead to a recovery in the world’s largest car market. In addition, several planned production cutbacks, which might tighten the copper market, and a rise in the share of commodity group Glencore also contributed to September’s rise.

In annual terms, average copper prices fell 24.1% in September, which was a slightly milder drop than August’s 26.8% decline. In fact, August’s decrease had marked the steepest drop in prices since July 2009. Nonetheless, September’s reading represented the 14th consecutive decline in annual terms. Since the beginning of this year, copper prices decreased 19.0%.

The Central Bank expects copper prices to average USD 2.9 per pound in 2015. Panelists participating in the LatinFocus Consensus Forecast expect copper prices to average USD 2.70 per pound in 2015, before increasing slightly to USD 2.72 per pound in 2016.


Author: Teresa Kersting, Economist

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Chile Commodities September 2015

Note: Cash seller and settlement price.
Source: Thomson Reuters.


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