China’s strong demand for copper is seen as a prime indicator of the momentum behind its economic growth. Globally, some analysts point to rising copper prices as a sure sign of economic recovery taking root. So, when copper starts to build up in bonded warehouses in China, rather than being in the domestic market, alarm bells start ringing.
Reports of large inflows of copper after the Chinese New Year in February not passing customs but sitting in warehouses has prompted worries that China’s real demand for copper is weakening, causing a stockpile to build up, which raises questions about China’s economic growth patterns and the dynamics of the global economy.
