Demand worries push copper to 20-month low
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Industrial metals were hammered on Monday, with benchmark copper tumbling almost 7 per cent as evidence of a global slowdown and demand worries mounted in the deepest financial crisis in 80 years. Copper sank to its lowest level in almost 20 months, while aluminium touched its weakest point since February 2006 and nickel plummeted more than 5 per cent to a 33 month-low. Copper for three-months delivery on the London Metal Exchange dropped to $5,575 a tonne, its lowest since January 2006 and was at $5,600/5,610 per tonne by 0957 GMT, versus Friday's $6,010.
''OVERFLOODED''
Aluminium sank to $2,253 a tonne, its lowest since February 2006 and was at $2,265/2,275 compared to Friday's $2,339. Last week, Alcoa said it was curtailing aluminium production at its Rockdale, Texas, smelter and would lay off approximately 600 workers. That should pave the way for a supply response - but it will take time as aluminium inventories are at around 1.38 million tonnes, their highest since March 2004.
''Because the market is just overflooded with supply, the price could eat into the production cost area as long as the demand picks up -- and I don't see it this year,'' LME trader said. Nickel hit a low of $14,350 and was last at $14,525 versus Friday's $15,150 while zinc dropped to $1,540 a tonne, its lowest since November 2005 and was at $1,544/1,554 versus Friday's $1,600. Lead dropped to a two-month low of $1,640 a tonne. Tin was at $16,675/16,875 a tonne.
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Source : Business Line |
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