Low stocks boost copper in LME trade

Print this page Posted on : 06-28-2008 by recycleinme.com

Copper prices were boosted on Friday by strong fundamentals and falling stocks, but worries about demand Chinese demand were expected to cap gains. Aluminium held firm as investors bought on expectations that rising costs of energy, which analysts estimate accounts for between one-third to 45 percent of smelting costs, would help push prices towards the record $3,310 set in May 2006.

Copper for three-month delivery on the London Metal Exchange was trading at $8,455 a tonne at 0939 GMT compared with $8,445 a tonne on Thursday. Stocks of copper in LME warehouses at around 122,900 tonnes have risen in recent months, but they are still nearly 40 per cent below the levels seen at the beginning of the year.

BULLS VERSUS BEARS

Aluminium was at $3,106 a tonne compared with $3,100 a tonne on Thursday. Opinion is split on whether aluminium will rise or fall. Bulls say that power problems and rising costs of electricity {ndash} especially in China which is the world's largest producer and consumer {ndash} mean producers will have to ramp up their prices to protect their operating margins. But the bears disagree saying global economic slowdown means falling demand. Zinc traded at $1,935 a tonne from $1,990 a tonne on Thursday, lead at $1,825 from $1,815, nickel was little changed at $21,800 and tin at $23,250 from Thursday's last quote at $23,150/23,200.

Source : Business Line