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

To: Stephen O who wrote (1254)	7/20/2005 10:04:07 AM
From: Stephen O	Read Replies (1) \| Respond to of 2131

Copper in London Trades Near Record High on Chinese Demand 2005-07-20 04:43 (New York) By Simon Casey July 20 (Bloomberg) -- Copper, already trading close to a record high in London, may rise in the next several days because of strengthening Chinese demand for the metal used in power cables expands and shrinking stockpiles. China, the world's biggest copper-consuming nation, will increase usage by at least 10 percent in 2005, Ingrid Sternby, an analyst a Barclays Capital in London, said in a report yesterday. Inventory monitored by the London Metal Exchange has plunged to its lowest in almost 31 years as consumers withdraw metal from warehouses to fill a shortfall in production. ``Copper inventories are very low, China continues to consume copper at higher rates and the U.S. economy is doing reasonably well,'' said Richard Adkerson, Chief Executive of New Orleans- based Freeport-McMoRan Copper & Gold Inc., which in Indonesia operates the world's second-largest copper mine. ``Underlying fundamentals are very strong,'' Adkerson said yesterday in an interview. Copper for delivery in three months on the London Metal Exchange was $7, or 0.2 percent, lower at $3,388 a metric ton as of 9:36 a.m. in London, after earlier gaining as much as $3. The metal traded at a record $3,435 on June 20. Inventory stored in LME-registered warehouses rose 1.8 percent to 27,450 tons, the exchange said in a daily report. The total has still declined 71 percent in the past year to an amount equal to less than one day of global demand. Copper users are relying on stockpiles because demand is forecast to beat production in 2005. Consumption will grow 3.7 percent this year to 17.4 million tons, exceeding output from mines and scrap yards by 72,000 tons, Barclays forecast. China accounts for 19 percent of global demand and North America 16 percent, according to the bank. Copper Strikes Strikes in the U.S. and Zambia may accelerate the decline in stocks. Vedanta Resources Plc has offered workers at its Konkola Copper Mines Plc unit in Zambia a 30 percent pay increase to end a week-old strike. Production dropped at Asarco Inc. mines in Arizona after workers walked off the job on July 3. Among other metals for delivery in three months on the LME, aluminum gained $5, or 0.3 percent, to $1,828 a ton. Nickel was down $25 to $14,000 and zinc slipped $2 to $1,208. Lead was unchanged at $842 and tin increased $50 to $7,225. --With reporting by Claudia Carpenter in New York. Editor: Wallace