Copper Rises as China’s Metal Imports Rebound, Dollar Slumps Share | Email | Print | A A A
By Anna Stablum and Millie Munshi
Oct. 14 (Bloomberg) -- Copper prices rose as purchases by China increased and the dollar’s slump bolstered the appeal of commodities.
China, the world’s biggest metal buyer, imported 399,052 metric tons of copper and related products in September, up 23 percent from August. The country reported declines in the two pervious months. The dollar fell to the lowest since August 2008 against a basket of six major currencies. Copper futures have doubled in 2009 as China’s demand surged in the first half.
“Chinese import numbers were a good surprise, coming in higher than people were expecting,” said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. “The dollar continuing to weaken added some fuel to the fire.”
Copper futures for December delivery gained 5 cents, or 1.8 percent, to $2.8445 a pound on the Comex unit of the New York Mercantile Exchange.
On the London Metal Exchange, copper for delivery in three months rose 1.3 percent to $6,220 a ton ($2.82 a pound).
The metal, used in pipes and wires, extended gains today after a report showed sales at U.S. retailers fell less than forecast in September, a sign households will play a greater roles in the emerging economic recovery.
“Copper will continue to be vulnerable to the ebbs and flows of the economy,” Zeman said. “The more positive reports we get, the more likely copper will continue to trade higher.”
Morgan Stanley raised its estimate for copper’s average price in 2009 to $4,998 a ton, compared with the average of $4,769.63 on the LME so far this year. The bank increased estimates for the average price to $6,559 for next year and $7,000 in 2011.
‘Broad, Strong Gains’
“We expect the broad and strong gains in base-metal prices in 2009 to be sustained into 2010 and beyond, led by copper, which remains our preferred base-metal exposure,” Morgan Stanley said in a report.
Inventories monitored by the LME rose for a third straight day to 353,225 tons, the highest since May 18.
“Despite recent inventory increases, the stock-to- consumption ratio remains remarkably low,” Morgan Stanley said.
BHP Billiton Ltd. workers began a strike yesterday at the Spence copper mine in northern Chile after rejecting a pay offer, a union spokesman said.
“The copper price should also be supported by the strike at Spence,” Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt, said in a report.
Chile is the world’s biggest copper producer.
Nickel, zinc and lead prices also rose in London. Aluminum and tin declined
KZL Price at posting:
$1.05 Sentiment: Hold Disclosure: Held
