Copper Has Biggest Weekly Gain Since May on Chinese Demand
By Halia Pavliva and Millie Munshi
March 16 (Bloomberg) -- Copper prices climbed in New York, capping the biggest weekly gain in nine months, on signs of rising demand in China, the world's biggest buyer of the metal.
China's copper output fell 1.8 percent from a year earlier in the two months ended February and industrial output soared 19 percent, above analysts' forecasts and the 15 percent gain in December. Imports of copper and copper products in February surged 70 percent.
``We had bullish data come out this week,'' said Catherine Virga, an analyst at CPM Group Inc. n New York. ``Prices at these levels are justified'' and may rise over the next two months, she said.
Copper futures for May delivery rose 2.3 cents, or 0.7 percent, to $3.011 a pound on the Comex division of the New York Mercantile Exchange, closing above $3 for the first time since Dec. 19. Prices climbed 8.1 percent this week, the most since late May.
A futures contract is an obligation to buy or sell a commodity at a set price for delivery by a specific date.
Prices have gained 4.9 percent this year. Since Feb. 1, inventories monitored by the London Metal Exchange have dropped 10 percent.
``There is still robust demand,'' said Jim Wyckoff, senior markets analyst at TradingEducation.com in Wesley Chapel, Florida. ``We are in a solid uptrend.''
Prices may climb to $3.25 a pound in coming weeks after breaching the ``psychologically important'' $3 level, he said.
Stockpiles monitored by the LME declined 0.9 percent to 194,400 metric tons today.
`Notable Reversal'
``LME stocks continue to decline, and this has been key in keeping the rally going, since it marks a notable reversal of the recent stock increases we have been seeing,'' Edward Meir, a commodities analyst at Man Financial Inc. in Darien, Connecticut, said in a report.
Copper fell as much as 1.2 percent earlier today as some investors sold the metal following the 5.7 percent gain yesterday, the most since July 6.
On the LME, copper for delivery in three months rose $70, or 1.1 percent, to $6,610 a metric ton ($3 a pound). Prices have gained 34 percent from a year ago. The metal has dropped 25 percent from a record $8,800 in May.
To contact the reporter on this story: Halia Pavliva in New York at [email protected] ; Millie Munshi in New York at o [email protected]
(20min delay)