cu levels low until 06

Copper Inventories to Remain Low Until 2006, Bloomsbury Says
Oct. 5 (Bloomberg) -- Copper inventories will remain low until 2007 when new projects will send the market into surplus, Bloomsbury Mineral Economics said in an e-mailed report.

The London-based industry consultant expects inventories in London Metal Exchange-appointed warehouses to fall as low as 40,000 tons from the current 97,625 tons and remain low until early 2006.

BHP Billiton Plc, the world's largest mining company, plans to boost output at its Escondida mine in Chile by 175,000 tons a year from 2006. It may open commission its Spence project in northern Chile the following, producing 150,000 tons of copper cathodes, Bloomsbury said.

Copper, used in power cables and electrical wiring, has surged 60 percent in the past year on surging demand in China, now the world's largest consumer of the metal, and production disruptions.

Bloomsbury expects copper prices to average $2,838 a ton in 2004, 38 percent above last year's average. They may then drop to $2,545 a ton in 2005, it said.