عربي English Türkçe اردو فارسى
Logo
Latest News
Business

China Metals Tumble on Recession Fears Amid Escalating Trade War 

A woman looks at her phone in the financial district of Shanghai on April 7, 2025. (AFP)
A woman looks at her phone in the financial district of Shanghai on April 7, 2025. (AFP)
TT
20
TT

China Metals Tumble on Recession Fears Amid Escalating Trade War 

A woman looks at her phone in the financial district of Shanghai on April 7, 2025. (AFP)
A woman looks at her phone in the financial district of Shanghai on April 7, 2025. (AFP)

Base metal prices in China tumbled on Monday amid escalating trade war concerns and recession fears, while London metals flipped to a decline after rising on arbitrage trading.

The most-traded copper contract on the Shanghai Futures Exchange (SHFE) dropped 7.0% to 73,640 yuan per metric ton as of 0805 GMT, hovering near its lowest level in over three months since January 3.

SHFE market was closed last Friday for a holiday.

"The retaliatory tariff makes us worry about trade war, which will impede economic growth globally," a metals trader said.

Top metals consumer China hit back on Friday with additional 34% tariffs on all US goods from April 10, after US President Donald Trump imposed a 34% tariff on most Chinese goods as part of his sweeping reciprocal tariffs.

Meanwhile, the benchmark three-month copper on the London Metal Exchange (LME) lost 0.5% to $8,733 per ton. Eearlier in the day, copper rose 3% on arbitrage trading.

"When the SHFE market opened in the morning, arbitrage traders actively traded on both SHFE and LME, capitalizing on the price gap to generate profit. Their activity increased market liquidity, which in turn pushed LME metals prices higher," a second base metals trader said.

"Then in the afternoon, the western traders participated in trading, and worries about recession took over," the second trader said.

The traders requested anonymity as they were not authorized to speak to the media.

Arbitrage trading between LME and SHFE happens when traders buy metals on an exchange where it's cheaper and sell it where it's more expensive, profiting from the price difference.

SHFE aluminium slid 3.7% to 19,685 yuan a ton, zinc lost 2.2% to 22,625 yuan, lead fell 3.1% to 16,660 yuan, while nickel was down 7.5% to 118,640 yuan, tin fell 8.6% to 267,800 yuan.

Among other metals, LME aluminium lost 1.0% to $2,355 a ton, lead declined 1.5% to $1,878, zinc lost 2.2% to $2,599, tin was down 4.9% at $33,650 and nickel was down 3.1% at $14,305 a ton.

LME aluminium, lead and zinc rose between 0.5% and 1.6% earlier in the day.

Most Viewed

 
Business

Colombia Joins Belt and Road Initiative as China Courts Latin America 

Chinese President Xi Jinping meets with Colombian President Gustavo Petro at the Great Hall of the People in Beijing, China, 14 May 2025. (EPA /Xinhua / Huang Jingwen)
Chinese President Xi Jinping meets with Colombian President Gustavo Petro at the Great Hall of the People in Beijing, China, 14 May 2025. (EPA /Xinhua / Huang Jingwen)
TT
20
TT

Colombia Joins Belt and Road Initiative as China Courts Latin America 

Chinese President Xi Jinping meets with Colombian President Gustavo Petro at the Great Hall of the People in Beijing, China, 14 May 2025. (EPA /Xinhua / Huang Jingwen)
Chinese President Xi Jinping meets with Colombian President Gustavo Petro at the Great Hall of the People in Beijing, China, 14 May 2025. (EPA /Xinhua / Huang Jingwen)

Colombia formally agreed on Wednesday to join China's vast Belt and Road infrastructure initiative, as Beijing draws Latin America closer in a bid to counter the United States.

Latin America has emerged as a key battleground in US President Donald Trump's confrontations with China, and the region is coming under pressure from Washington to choose a side.

China has surpassed the United States as the biggest trading partner of Brazil, Peru, Chile and other Latin American nations, and two-thirds of countries there have signed up to Chinese leader Xi Jinping's Belt and Road infrastructure drive.

On the sidelines of a major gathering of regional leaders in Beijing on Wednesday, Colombia became the latest country to join the massive global initiative.

Colombia's foreign ministry hailed the agreement as a "historic step that opens up new opportunities for investment, technological cooperation, and sustainable development for both countries".

And after a meeting with Colombian President Gustavo Petro, Xi urged the countries to take the opportunity of Colombia formally joining the "Belt and Road Initiative family" to enhance their cooperation, Beijing's state media said.

Posting a video of the signing to social media platform X, Petro wrote that "the history of our foreign relations is changing".

"From now on, Colombia will interact with the entire world on a footing of equality and freedom," he wrote.

The BRI is a central pillar of Xi's bid to expand China's economic and political clout overseas.

For more than a decade, it has provided investment for infrastructure and other large-scale projects around the world, offering Beijing political and economic leverage in return.

Last year, Xi inaugurated Latin America's first Beijing-funded port in Chancay, Peru -- a symbol of the Asian superpower's growing influence on the continent.

- 'Defenders of free trade' -

This week's China-CELAC Forum in Beijing has seen China cast itself as the defender of the multilateral order and the backer of the Global South, with Xi pledging on Monday $9.2 billion in credit towards development.

That pledge was part of a broad set of initiatives aimed at deepening cooperation, including on infrastructure and clean energy.

Beijing will also cooperate in counterterrorism and fighting transnational organized crime, Xi said, as well as enhancing exchanges such as scholarships and training programs.

During a meeting with Chilean President Gabriel Boric on Wednesday, Xi said that the "resurgence of unilateralism and protectionism is severely impacting the international economic and trade order," according to Chinese state news agency Xinhua.

"As staunch defenders of multilateralism and free trade, China and Chile should strengthen multilateral coordination and jointly safeguard the common interests of the Global South," Xi told Boric.

Also in attendance at the China-CELAC forum was Brazilian President Luiz Inacio Lula da Silva, who arrived in Beijing on Saturday for a five-day state visit.

Addressing delegates, Lula said his region did not "want to repeat history and start a new Cold War", adding: "Our goal is to be an asset to the multilateral order for a global good".

In talks with Lula on Tuesday, Xi said the two countries should "strengthen cooperation" and together "oppose unilateralism", according to Chinese state media.

The United States and China have faced off in Latin America, including over the Panama Canal, which Trump has for months vowed to reclaim from alleged Chinese influence.

Washington considered a Hong Kong company's operation of ports at both ends of the interoceanic waterway to be a threat to its national security, but Beijing has dismissed the claims.

And China's market regulator is looking into a deal by Hong Kong conglomerate CK Hutchison to offload 43 ports in 23 countries -- including its two on the Panama Canal -- to a US-led consortium.

The world's two largest economies are two of the top users of the canal, through which five percent of all global shipping passes.