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

To: russwinter who wrote (777)	4/23/2004 3:22:28 PM
From: Stephen O	Respond to of 2131

Good grub Russ; Copper Prices May Rise in Next Two Years on China, U.S. Demand By Matt Chambers April 23 (Bloomberg) -- Copper prices may rise in 2005 and 2006 as Chinese and U.S. demand for the metal used in pipes and electrical wiring continues to drain stockpiles, Standard Bank Group Ltd., Africa's biggest bank, said. Copper prices, which surged 69 percent in the past year, may rise 2 percent next year to $2,755 a metric ton and then to $2,865 in 2006, Standard Bank London said in its Copper Report. Stockpiles in the Western World will total 987,000 metric tons, or 4.1 weeks of consumption in 2004, decreasing to 697,000 tons in 2006. ``The market has moved into a substantial deficit which looks set to persist until 2006,'' Standard Bank said in the report. ``Additionally this year will be the impact of belated recovery in Western World demand.'' U.S. economic growth in the first quarter probably will be revised to 5 percent from a reported 4.1 percent, based on the median estimate in a Bloomberg survey. The U.S. is the second- largest copper user after China, where growth was 9.7 percent in last quarter. Copper demand typically increases when economies grow. Copper supply, hampered this year by production setbacks at the world's two biggest copper mines, is forecast to increase at 5.5 percent a year, or 1.94 million tons, until 2006, while demand increases 4.2 percent, or 1.53 million tons a year, Standard Bank said. Escondida in Chile, the world's biggest copper mine, may lose 200,000 tons of forecast production this year, the report said and Grasberg in Indonesia, the second-biggest, may lose 226,000 tons. ``By the end of 2006 the market will be delicately poised,'' Standard Bank said. Any further mine disruptions or strong Chinese demand ``could easily push our forecast deficits significantly higher.'' Copper for delivery for three months closed at $2,705 on the London Metal Exchange yesterday, its lowest since Feb. 13. LME stockpiles have fallen 80 percent in the past year to 159,575 metric tons. --Editors: Langan, Gosman.