Copper Rises to 4-Month High on Norilsk Cutback Announcement
New York, Nov. 27 (Bloomberg) -- Copper rose to its highest
price in four months after OAO GMK Norilsk Nickel, Russia's
largest copper producer, joined other mining companies in
announcing plans to reduce output.
Norilsk will trim nickel, copper and cobalt production at
least 10 percent next year because of declining prices, the Prime-
Tass news agency reported yesterday, citing an unidentified source
at Norilsk. Copper prices have rebounded 16 percent from a 14-year
low on Nov. 8 on cutbacks by mining companies including Phoenix-
based Phelps Dodge Corp., the second-largest producer.
``The Norilsk news was unanticipated, so it has more price
impact,'' said Jim Steel, director of commodity research at Refco
Inc. in New York. ``We've all been so centered on North American
cutbacks, because that's where the highest-cost production is.''
Copper for December delivery rose as much as 2.7 cents, or 4
percent, to 71 cents a pound on the Comex division of the New York
Mercantile Exchange, the highest price for a most-active contract
since July 19. The contract recently was up 1.9 cents at 70.2
cents a pound.
Norilsk produces about 400,000 metric tons of copper a year,
or about 55 percent of Russia's output of the metal.
Copper futures retreated from the day's high after a report
showing consumer confidence in the U.S. economy dropped
unexpectedly in November to the lowest level in 7 1/2 years.
``This data reconfirms that underlying demand for copper has
not improved any,'' Steel said.
In London, copper for delivery in three months rose $23.50,
or 1.6 percent, to $1,538.50 a ton (69.79 cents a pound) on the
London Metal Exchange.
--Stephen Voss in the New York newsroom (212) 318-2278 or at
sev@bloomberg.net with reporting by Eduard Gismatullin in the
Moscow bureau/jb |
