Provoking trade disputes is “naked economic terrorism,” Chinese Vice Foreign Minister Zhang Hanhui said on Thursday amid a lengthening trade row between the world’s top two economies.
Tit-for-tat tariffs between the US and China resumed earlier this month.
The United States blacklisted China’s Huawei Technologies and Chinese media hinted the government may use its dominant position as an exporter of rare earths as leverage.
“Negotiations appear to have halted and although there has been nothing specific to suggest that there won’t be further discussions, the recent actions from the Chinese indicate everything is moving in the wrong direction in terms of getting a deal,” said Capital Economics analyst Ross Strachan.
South Australia is a major copper exporter. BHP’s Olympic Dam mine, 560km north-west of Adelaide, is the fourth-largest copper resource in the world.
OzMinerals and Havila Resources also have major copper projects under development here.
The trade conflict has the potential to sap demand for copper from China, which accounts for nearly half of global consumption estimated at about 24 million tonnes this year.
Three-month copper on the London Metal Exchange ended 0.5 per cent lower at $US5852 a tonne, its lowest since January 4.
Headline stocks of copper in LME-approved warehouses surged 27,450 tonnes or 15 per cent to 212,450 tonnes, having jumped about 60 per cent so far this year.
In China, stocks of copper fell 8.4 per cent to 172,266 tonnes, according to latest available weekly data from the exchange today.
Prices for LME tin touched the lowest since November at $US18,630 per tonne, but closed 0.3 per cent higher at $US18,775 per tonne.
Stocks of tin have shot up 60 per cent so far this week to 2,650 tonnes.
In a fight against US sanctions that threaten to push it out of global markets, Huawei Technologies filed a legal motion seeking to declare a US defence law unconstitutional.
Disruptions in top copper producer Chile, political and power problems in Zambia and restrictions on scrap imports into China are expected to weigh on copper supplies in the second half of 2019.
The premium of LME cash zinc over the three-month contract eased to $US144 a tonne on Thursday after touching a 22-year high of $US161 the day before, indicating near-term shortages in the LME system.
The London zinc market is in the grip of the most protracted and acute squeeze in 30 years.
Aluminium fell to its lowest in a week, down 0.7 per cent at $US1782 per tonne, zinc rose 0.7 per cent to $US2561, lead slipped 1.6 per cent to trade at $US1803 and nickel rose 0.9 per cent in electronic trading to $US12,155.
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