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Gold/Mining/Energy : Copper - analysis -- Ignore unavailable to you. Want to Upgrade?

To: Stephen O who wrote (282)	3/9/2001 3:07:22 PM
From: Stephen O	Read Replies (1) \| Respond to of 2131

Copper Stockpiles Surge a 2nd Day, May Rise More, Analysts Say London, March 9 (Bloomberg) -- Copper inventories monitored by the London Metal Exchange surged, marking a 17 percent gain in two days, sparking speculation among analysts that further gains may come in the next week. The deliveries of copper, which totaled 54,750 tons, brought LME-monitored warehouses worldwide to 377,525 tons. The metal is likely coming from a U.S. trading company, which is winding up positions because of reduced demand, analysts said, adding another 50,000 tons may be brought to the exchange. ``The company may be reflecting on current demand,'' said Adam Rowley, an analyst at Macquarie Bank. ``You would expect a change of strategy given that there's not much demand around.'' An economic slowdown in the U.S. has reduced demand for copper from homebuilders, which use the metal in wires and pipes, and from carmakers, which also use copper parts. U.S. orders for durable goods, such as appliances and automobiles, fell 6.5 percent in January from the month before. Traders speculated the company transferring copper to LME inventories may be Enron Corp., which entered metal trading by purchasing MG Plc last year. A spokeswoman for Enron metals in London, Julie Green, couldn't immediately comment. Copper was little changed, after falling 1.1 percent yesterday, because traders anticipated another big rise today, analysts said. Copper for delivery in three months fell as much as $2, or 0.1 percent, to $1,797 a metric ton on the LME. The price for the metal will likely remain little changed as Phelps Dodge Corp., the world's second-largest copper producer, debates closing mines in New Mexico and Arizona, traders said. The company has said it would decide by the end of this month whether to close the mines and dismiss 2,350 workers because of high electricity and fuel prices. ``People are reluctant'' to place bets on a fall in the copper price, Rowley said. ``They're waiting for Phelps Dodge's announcement. If the company actually cuts production, that will be very supportive'' for the price.