copper rises in asia as china demand surges

Copper Rises in Asia as China Demand Surges; Zinc, Aluminum Up

By Li Xiaowei

Aug. 23 (Bloomberg) -- Copper rose in Shanghai after China's imports more than doubled in the first seven months of this year and stayed high into the traditionally low summer demand season.

Imports of refined copper and alloys rose to 1.03 million metric tons in the seven-month period, and jumped 65 percent to 103,089 tons in July, from a year earlier, the Beijing-based customs office said yesterday. BHP Billiton Ltd., the world's largest mining company, said yesterday demand growth remains ``robust'' in Asian emerging economies, especially China.

``The rebound in global equities is also giving a lift to sentiment'', said Cai Jinrong, an analyst at metals trader Wanxiang Resources Co. in Shanghai. ``The demand outlook is improving,'' he said.

Copper for October delivery on the Shanghai Futures Exchange rose as much as 1,790 yuan, or 2.8 percent, to 64,800 yuan ($8,537) a ton. It traded at 64,780 yuan at the end of the morning session at 11:30 a.m. local time. The metal for immediate delivery in Changjiang, Shanghai's biggest cash market, rose as much as 2.6 percent to 65,100 yuan a ton today.

Asian stocks gained for a fourth day after a capital injection into the biggest U.S. mortgage lender reduced concern that a credit squeeze will derail economic growth. Copper, mostly used in the power and construction industries, sometimes takes direction from growth expectations.

Copper for delivery in three months gained 1.4 percent to $7,250 a ton on the London Metal Exchange at 12:18 p.m. Shanghai time, after rising 2.5 percent yesterday.

A credit crunch won't have a ``material impact'' on demand for raw materials, and commodities supply and demand was ``intact,'' BHP Billiton Chief Executive Officer Charles ``Chip'' Goodyear said on a conference call yesterday.

Global Equities

London Metal Exchange copper fell 5.9 percent last week after a slump in global equities, triggered by U.S. subprime mortgage defaults, prompted investors to sell commodities to cover losses and reduce risks.

The Morgan Stanley Capital International Asia Pacific Index, a regional equity benchmark, in its longest winning streak in seven weeks, rose 2.6 percent to 148.62 at 12:27 p.m. in Shanghai.

Zinc in Shanghai for October delivery rose 2.5 percent to 27,480 yuan a ton at the 11:30 a.m. break, while November- delivery aluminum gained 0.5 percent to 19,410 yuan a ton.

Aluminum Corp. of China Ltd., China's biggest producer of the lightweight metal, said it expected China to become a net importer for the first time since 2001 because of surging demand from automakers and packaging producers. The change was ``only a matter of time,'' Xiao Yaqing, chairman of Chalco, as the company is known, said in an interview yesterday.

Other Metals

Zinc for delivery in three months on the London Metal Exchange was 1.3 percent up at $3,145 a ton at 12:32 p.m. Shanghai time, while aluminum was 0.8 percent up at $2,535 a ton.

Among other LME-traded metals, lead rose 2.9 percent to $3,070 a ton, nickel gained 4.1 percent to $29,300, and tin was up 0.8 percent at $14,550 a ton.

Lead demand beat supply by 73,000 tons in the first six months of this year, the World Bureau of Metal Statistics said yesterday. The deficit compared with a surplus of 34,000 tons in the same period last year, the Ware, England-based organization said in an e-mailed statement.

To contact the reporter on this story: Li Xiaowei in Shanghai at [email protected] .