Copper and Aluminum Drop as Gains Peter Out Before China Break

Group 1 - Copper and aluminum prices have declined as the rally supported by Chinese buying has stalled ahead of the Lunar New Year holiday, with benchmark copper futures nearing $13,000 a ton in London and $5.90 a pound in New York after a previous gain of over 2% [1][5] - Chinese copper buyers are expected to take an extended break during the holiday, which is anticipated to reduce industrial demand due to high prices [1] - Exchange inventories in China and the broader Asian market have been increasing, with total stockpiles in warehouses tracked by major exchanges exceeding 970,000 tons, the highest level since 2003, and over half of these reserves are located in the US [2] Group 2 - Analysts note a consolidation around $6 a pound for copper, with reluctance from end users to purchase at elevated prices; however, there is an expectation for continued price momentum in the coming years due to rising demand and supply challenges [3] - Copper prices had previously reached an all-time high above $14,500 on January 29, driven by investor interest in commodities amid concerns over the US dollar, but have since dropped 0.5% to settle at $13,108 a ton [5] - Aluminum prices have also decreased by 1% to $3,093 a ton, while other metals have seen price increases [5]