Copper Falls for a Third Day in London on Supply Concerns
2005-06-09 06:05 (New York)
By Chanyaporn Chanjaroen
June 9 (Bloomberg) -- Copper futures fell for a third
consecutive day in London on traders' concern that rising
production of the metal, which is used to make wires and brass,
will exceed demand and hurt prices.
Codelco, the world's largest copper producer, said yesterday
it plans to increase output to 2.4 million metric tons by 2012 and
invest as much as $17 billion by 2015. The company produced 1.84
million tons last year. Miners are boosting output after prices on
the London Metal Exchange surged 37 percent last year.
``Cable customers are waiting for prices to decline in the
second half,'' Darren Goldthrope, sales and purchasing manager of
Wakefield, U.K.-based Tri-wire Ltd. said by telephone today. Tri-
wire buys as much as 11,000 tons of copper a year to produce wires
from power cable makers.
Copper for delivery in three months fell $18, or 0.6 percent,
to $3,222 a ton as of 10:56 a.m. in London, paring the gain this
year to 2.3 percent. The contract earlier fell as much as $35, or
1.1 percent, to $3,205, the lowest since June 3.
Copper inventories monitored by the LME fell 75 tons, or 0.2
percent, to 40,625 tons, the exchange said today. That's the
seventh consecutive day of declines. Stockpiles are at their
lowest since July 1974, when inventories were reported weekly,
according to Bloomberg data.
Prices for copper will probably fall to between 95 cents and
$1 a pound in 2007 and 2008 as mining companies boost production,
said Juan Villarzu, president and chief executive of Codelco, at a
news conference in Santiago yesterday. The benchmark price on the
Comex division of the New York Mercantile Exchange reached a 16-
year high of $1.58 a pound on June 6.
Copper Shipments
Shipments of copper and brass parts from U.S. and Canadian
distributors fell 3.7 percent in April from the previous month,
the Copper & Brass Servicenter Association said yesterday.
Shipments to automobile manufacturers, pipe makers and other users
of the metals dropped 8 percent from a year earlier, the Wayne,
Pennsylvania-based association said.
Most other LME-traded metals for delivery in three months
declined. Aluminum fell $9, or 0.5 percent, to $1,723 a ton and
lead declined $10, or 1 percent, to $952. Zinc fell $12, or 0.9
percent, to $1,288. Nickel and tin weren't traded.
--With reporting by Heather Walsh in Santiago and Claudia
Carpenter in New York. Editor: Osborne, Wallace |
