(09/11) Copper up on weak dollar, brighter demand outlook

November 09, 2009

London copper rose more than one per cent on Monday, supported by a weak dollar and a brighter demand outlook, after Codelco raised premium charges for Asian customers in 2010.

Chile's Codelco, the world's largest copper miner, has said the term premium for copper to the Japanese port of Yokohama will rise 15 per cent a year earlier to $US75 a tonne in 2010.
Three-month copper futures on the London Metal Exchange rose $US90 to $US6,580 a tonne by 1802 AEDT, reversing losses in the previous session caused by soft US job data released on Friday.

Shanghai's benchmark third-month copper futures edged up 0.3 per cent to close at 51,310 yuan a tonne.

"Investors are a little cautious ahead of the data release -- if October's imports data turned out weak, it would indicate the current prices were the result of short-term speculation without support from fundamentals," said Peng from COFCO Futures.

China's October imports of unwrought copper and semi-finished copper products are expected to fall after a surprisingly strong inflow in September, hit by poor margins for spot imports and delays to contracted shipments.

Some traders and analysts, however, expected copper prices to remain trapped in narrow price ranges, if the balance of bearish and bullish factors stays.

"There won't be much going on in the next week or two, unless some major news breaks.

London copper is likely to be trading in the range of $US6,480 and $US6,600," said a Shanghai-based trader.

(09/11) Buy MCX copper Nov contract above Rs 306

November 09, 2009

Shanghai copper is expected to open lower on Monday, tracking losses in London copper in the previous session, following a deeper than expected cut in U.S. jobs in October. Also some pressure had been seen from the stockpiles also which had climbed for a second week to the highest in more than five years. Inventories of the metal expanded 1,440 metric tons, or 1.4%, to 104,275 tons this week, this is the highest level since Apr. 2004. COPPER yesterday the LME stock was 5,075mt against the previous of 5,825mt. Copper has touched a low of Rs 305.3 a kg after opening at Rs 306.05, and last traded at Rs 305.55.
Currently, MCX copper November contract are trading 0.44% higher at Rs 306.90 per kg. It hovered in the range of Rs 306- 307.80 per kg. For today market is looking for the support at Rs 305.20, a break below could see a test of Rs 304.60 and where as resistance is now likely to be seen at Rs 305.90, a move above could see prices testing Rs 306.80.

He suggested buying in MCX copper November contract above Rs 306 with stop loss of Rs 304.80 and target of Rs 306.80-308.20-310.40.

(09/11) Chinese copper imports rise, boosts stocks

Novemeber 09, 2009

Copper stocks traded firm on the Bombay Stock Exchange as the Chinese copper imports showed significant rise over last month.

Chinese copper imports in September increased 22% month-on-month from August to 399,052 ton. However, volumes in the month of July and August had seen import volumes decline.
The copper price reacted positively to the news but was capped by further gains in LME warehouse stocks, which suggests that demand outside of China is still very weak. London copper rose more than 1% on Monday, reversing from losses in the previous session.

Copper stocks on the bourses traded with positive trend in the afternoon trading session today. Hindustan Copper Ltd traded at Rs.270 up by close to 1%, while Vedanta Group major, Sterlite Industries Ltd traded at Rs.809.6 up by 0.5% on the BSE today.
Copper prices on the Indian commexes traded up at Rs.307.25 per kg for MCX November contract.

LME warehouse stocks have now risen by 39% since their low in mid-July, to more than 357,000t as of 19th October. In contrast Shanghai stocks have dropped to 100,217t from 104,248t in mid- September. Experts do not expect to see an appreciable pick-up in OECD copper demand in Q4 2009, and therefore Chinese demand will be crucial in determining price strength in the short-term.

(09/11) METALS-Copper prices up, brush off dismal U.S. job data

November 09, 2009

London copper rose more than 1
percent on Monday, reversing from losses in the previous
session as investors brushed off grim U.S. job data. The U.S. unemployment rate jumped to 10.2 percent in
October, a 26-1/2-year high, but closer inspection of the data
showed that payroll losses kept declining and job losses for
earlier months were revised lower.
"The high employment rate will push the Federal Reserve to
maintain the low interest rate and keep abundant liquidity in
the market," said Liang Zhigang, an analyst at Star Futures. "If the unemployment rate lowered significantly, the Fed
would probably change monetary policy, which might add pressure
to commodities." Three-month copper futures contract on the London Metal
Exchange MCU3 rose $75 to $6,565 a tonne by 0224 GMT.
Shanghai's benchmark third-month copper futures SCFc3
contract edged up 0.16 percent to 51,220 yuan a tonne. "There won't be much going on in the next week or two,
unless some major news breaks. London copper is likely to be
trading in the range of $6,480 and $6,600," said a
Shanghai-based trader.

(09/11) Copper: Chinese imports spring a surprise

November 09, 2009

China surprised the copper market in October, with data showing that its imports of unwrought copper and copper products in September increased 22% month on- month from August, to 399,052t. July and August had seen import volumes decline, month by month, and the market consensus was that September would see the third consecutive monthly slide.

The fact that import volumes reversed indicates clearly that Chinese demand is still healthy, especially considering the high copper price and negative differential between Shanghai and LME copper price (including VAT). The copper price reacted positively to the news but was capped by further gains in LME warehouse stocks, which suggests that demand outside of China is still very weak.

We estimate an apparent copper surplus of nearly 300,000t in 2009 and perhaps half that in 2010, as demand conditions improve and copper supply is hit by mine-supply disruptions. It is a fine balancing act, one where China's amassed off-market copper stocks - probably some 1 Mt - will have the final word.
Oct 13th: Chile's Escondido averted a strike, after workers accepted a wage offer from BHP Billiton. The reverse happened at BHP's Spence mine in Chile, where workers opted to strike. Spence produced 164,671t of copper in 2008.

Oct 9th: The International Copper Study Group (ICSG) forecast the refined copper market will be in surplus of about 370,000t in 2009, with weak demand eclipsing a decline in production. The ICSG expects the surplus to rise to around 540,000t in 2010.

(09/11) RPT-China copper scrap output seen peaking from 2014

November 09, 2009

China's locally-produced copper scrap is expected to peak as early as 2014, a director at powerful industry body the China Nonferrous Metals Industry Association, said on Sunday.
'Another five to six years, the collection of copper scrap domestically would enter into the peak period,' Lu Jian, director of the information department of the association's recycling branch, told Reuters on the sidelines at the end of a two-day copper industry conference in Wuhan city in Hubei province.
He did not provide a scrap production estimate for that period but for this year Lu said the production of copper scrap in China would fall from last year's 600,000-700,000 tonnes following a sharp supply fall in the first quarter, when the global financial crisis cut demand.
China produces a third of its copper scrap, heavily relying on imports, which fell 33 percent on the year to near 3 million tonnes in the first nine months of the year.
Scrap is used both by smelters as feed for the production of refined copper in China and by fabricators as feed for the production of semi-finished copper products.
A quarter of China's semi-finished copper products is made from copper scrap and a third of the country's refined copper production is made from scrap, Lu told the copper conference.

China produced 1.2 million tonnes of recycled copper in the first nine months of the year of which only a third came from locally collected scrap, he said.

That recycled copper output reflects a near 16 percent fall in monthly production on average this year. The output was 1.9 million tonnes in 2008.

(09/11) METALS-Shanghai copper to open lower, tracking LME losses

November 09, 2009

Shanghai copper is expected to
open lower on Monday, tracking losses in London copper in the
previous session, following a deeper-than-expected cut in U.S.
jobs in October.
* Three-month copper on the London Metal Exchange MCU3
fell $40 to $6,490 a tonne on Friday, but recovered to $6,495
in after-hours trading. * When Shanghai closed on Friday, LME copper stood at
$6,600 a tonne. * The U.S. jobless rate unexpectedly jumped to 10.2 percent
last month, a 26-1/2-year high, adding to pressure on the Obama
administration to do more to tackle unemployment even as signs
of recovery mount.
* While demand for copper elsewhere remains sluggish,
China's real consumption of refined copper in 2009 is expected
to grow 10.2 percent versus a 7.5 percent rise last year, said
a senior analyst at state-backed research group Antaike.