shanghai copper little changed on outlook for chin

Shanghai Copper Little Changed on Outlook for China Imports

By Xiaowei Li

Jan. 9 (Bloomberg) -- Copper futures in Shanghai traded little changed near a nine-month low, after plunging 9 percent last week, on signs the decline in prices may spur buying from China, the world's biggest consumer of the metal.

The amount of LME copper stockpiles bought and due for future delivery, known as canceled warrants, almost tripled since Jan. 3 to 21,600 tons, with most increases in Asian warehouses, a signal demand may be recovering in the region.

``We expect most of the canceled warrants to be bound for China,'' said Lu Chenghong, a trading manager at Golden Dragon Precise Copper Tube Inc., today. Buying from new investment funds allocating assets may also support the market, he said.

Copper for delivery in March on the Shanghai Futures Exchange rose as much as 430 yuan, or 0.8 percent, to 53,170 yuan ($6,808) a metric ton. The contract, which fell to the lowest since April 6 yesterday, traded at 52,710 yuan at 10:09 a.m. Shanghai time.

Copper for delivery in three months on the London Metal Exchange traded little changed at $5,605 a ton at 10:09 a.m. Shanghai time, after falling 11 percent last week.

U.S. sales of existing homes rose in October and November, the first back-to-back monthly gain since late 2005. New-home sales are up too, helping pare the number of unsold properties to 545,000 from a record 573,000 in July.

Federal Reserve Vice Chairman Donald Kohn said yesterday there are ``tentative signs'' the housing market may be stabilizing. Builders are the biggest users of copper in the U.S., the world's second largest user of the metal after China.

A futures contract is an obligation to buy or sell a commodity at a fixed price for a specific delivery date.