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Copper prices witnessed biggest gain in over two months as speculation that China-based smelters are hoarding the metal. The China hoarding factor spurred up copper prices rebounding from six-year low. Chinese smelters may slash output and stop capacity expansion this year.

China, the largest copper consuming country, has turned keen on copper stockpiles and smelters have started discussions on accumulating metal as reserved stockpiles, says industry consultancy SMM. Chinese smelters Copper price is in the consolidation phase at $4,400 per metric ton during the past 10 days.

Bloomberg reports that Chinese metal firms and major miners are curbing oversupply of copper as the metal price tumbled to the lowest since 2009. The economy slowdown in the world's second largest economy has eased the demand for copper. The investment inflow in the mining sector over the years has resulted in higher output and oversupply.

Chinese smelters have started offloading copper stocks, when the prices were higher. Earlier, the stock piling led to the artificial pricing level for copper in the global metal markets. The stockpiles tracked by the London Metal Exchange were hovering at seven-month low. The offloading inventories from warehouses resulted in 22 percent decline at bonded warehouses in China.

However, there's no official data on stockpiles by Chinese smelters is available. Bloomberg Intelligence analyst Kenneth Hoffman sees no surge in demand for copper. Hence, supplies have been shifting to other warehouses on logistics support. The stock levels of semi-finished copper goods in China warehouses are expected to be over 600,000 metric tons, as reported by Financial Review.

Copper prices on London Metal Exchange rose to $4,430 per metric ton on Thursday and the metal seems to be in consolidation phase at $4,400 per metric ton during the past seven trading sessions.

On 21 January 2016, the copper stock level rose 1.2 percent and reached 238,125 tons. The highest copper stock pile was 371,250 tons as on 28 August 2015. Since then copper stocks fell 35.86 percent. The LME base metal inventory data reveals that copper stock level rose 1.20 percent to 238,125 tons as on 21 January 2016, according to a report by Market Realist.

Michael Smith, the president of T&K Futures & Options in Port St. Lucie, Florida, said: "Once you hoard something like that, it's going to take supply out of the market. Such a move will push prices higher."
Copper futures for March delivery rose over three percent to $2.1125 a pound on the Comex in New York.

This was the major gain for the most active copper contract since 30 September 2015. Copper for delivery in three months on London Metal Exchange (LME) was up over three percent to $4.685 a metric ton ($2.13 per pound). Other metals aluminum, lead, nickel, tin and zinc prices were also moving up on London Metal Exchange.