Copper, iron ore prices tank as China virus spreads

Impact on vital construction industry could be significant.

Copper and iron ore prices were hammered on Thursday as the deadly coronavirus outbreak in China added to worries about slowing economic growth in the globe's top commodities importer.

Six consecutive down days in New York saw copper for delivery in March wipe out the year's gains, falling to a seven-week low of $2.771 a pound ($6,110 a tonne) in New York.

Iron ore lost 3.4% on the day with benchmark Northern China import prices for 62% Fe fines tracked by Fastmarkets MB pegged at $93.44 a tonne.

China imports more than half the world's copper and controls more than three-quarters of the seaborne iron ore trade.

Full year imports of refined copper fell six% in 2019, but concentrate imports surged to 22 million tonnes an 11.6% gain on record imports the year before. Chinese imports of iron ore topped 1 billion tonnes for the third year in a row in 2019.

In a note, Capital Economics said the cooling property construction is likely to weigh on economic activity in the coming quarters:

But with external demand starting to stabilise, the slowdown should be gradual, as long as the coronavirus outbreak is contained.