Copper has fallen to its lowest point since the global financial crisis, dragging the major miners down as well.
The metal’s price fell to a six year low, dropping 1.7 per cent to US$4407.5 per tonne on the LME, and down to US$1.9964 per pound in the US 24 hour markets, wiping out the majority of gains made late last year.
The Shanghai Futures Exchange recorded a 2.6 per cent decline in copper, compounding a 2.7 per cent drop from last week.
The immediate future remains dim for the metal, as last week copper future for March delivery fell 4.3 per cent to US$1.9985 per pound.
On the back of this stockpiles of the metal actually rose.
“Markets are pricing slower growth in China,” Jens Naervig Pedersen, an analyst at Danske Bank A/S told Bloomberg.
“The base-metals market badly needs some comfort from US and Chinese monetary policy makers and stronger macroeconomic key figures.”
This hammering of a key base metal flowed onto the sharemarket, dragging down many of the major miners.
BHP’s shareprice dropped nearly five per cent down to $15.55 per share, its lowest level in a decade.
Rio Tinto also felt the pain, albeit less so, with its shareprice falling 3.34 per cent to $40.5.
However the world’s largest copper miner, Freeport McMOran was rocked by the drop, with its share price plummeting nearly 14 per cent to US$4.66 on the back of the copper slump.
Yet despite the current implosion for the metal, analysts have a positive outlook.
Speaking to ANZ senior commodities strategist, Daniel Hynes, he told Australian Mining the outlook for base metals into next year is positive.
“The outlook is better…the oversupply is not as bad as the bulk markets [such as iron ore],” he said.