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Prices for two of the world’s most important mined commodities are diverging quickly, with copper rallying above $9,000 a ton as supply cuts hit the market and iron ore sinking as demand headwinds mount.
The steelmaking ingredient has shed more than 30% since early January as hopes of a meaningful revival in construction activity faded. Loss-making steel mills are buying less ore, and stockpiles are piling up at Chinese ports. Further afield, industrial conditions in Europe and the US still look soft, but there’s growing optimism about copper usage in India, where rising investment has helped fuel blowout growth rates of more than 8% — making it the fastest-growing major economy.in global mine supplies. That’s been driven mainly by last year’s closure of a giant mine in Panama, but there are also growing worries about output in Zambia, which is facing an El Niño-induced power crisis.