Prices of copper, a barometer for the health of the global economy, have dived more than 12% since mid-January, as the coronavirus outbreak pushed China to extend a shutdown in its manufacturing regions.
Copper prices fell for the 13th straight day on Monday to a low not seen since September last year, as the outbreak grew more widespread.
From electronics to construction of homes, copper is used extensively in manufacturing and demand for the metal — dubbed Dr. Copper — is an indicator of the economy's health. China is the world's largest metals consumer.
"Copper's ... really tied to the manufacturing sector. Manufacturing's been the weakest front in the global economy," Jeffrey Kleintop, chief global investment strategist at Charles Schwab, told CNBC on Tuesday. "The concern is, this is another shock to the global economy, and manufacturing after the trade shocks of last year. And it's enough to keep copper and other base metals used in the manufacturing process in ... a period of weakness."
Prices of copper traded in Shanghai also fell to a three-year low on Monday as Chinese markets reopened after an extended Lunar New Year break. The most traded copper contract on the Shanghai Futures Exchange fell by its daily limit of 7%.
The Shanghai Futures Exchange has suspended night trading till further notice.
The shutdown in China's key manufacturing regions will hit copper prices further, ANZ Research pointed out in a report last week. Many Chinese cities have also imposed strict travel restrictions.
"In China's key industrial sectors – construction, autos, and durable goods – demand for copper makes up around 50% of total consumption," wrote Daniel Hynes, senior commodity strategist at ANZ Research.
"Assuming a two-week shutdown, we could see demand for copper fall by levels similar to 2003's SARS outbreak," he said.
The current coronavirus outbreak, first reported to the World Health Organization in late December in the Chinese city of Wuhan, has drawn comparisons to the deadly 2002-2003 SARS epidemic as they both come from the same family of viruses. The number of deaths in mainland China has now surpassed that of SARS.
Last week, China began extending a shutdown in more than half of its regions. As of Monday morning, at least 24 provinces, municipalities and other regions in China told businesses not to resume work before Feb. 10 at the earliest.
Last year, those regions of China accounted for more than 80% of national GDP, and 90% of exports, according to CNBC calculations of data accessed through Wind Information.
Businesses in the virus epicenter of Hubei province, of which Wuhan is the capital, will return to work even later, on Feb. 14.
Wuhan, which has a high concentration of high-tech manufacturing firms, represents about 1.8% of China's GDP and is the seventh largest economy in China, Hynes said, adding that key industries include steel, automobiles, and technology.
Futures markets in China tumbled on Monday at the open, on fears that demand in the world's top producer and consumer of commodities would take a hit.
Supply chains have been disrupted due to travel restrictions, while many cities are in virtual lockdown.
— CNBC's Evelyn Cheng contributed to this report.