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

To: TheSlowLane who wrote (1301)	10/7/2005 3:56:27 PM
From: Stephen O	Read Replies (1) \| Respond to of 2131

Copper Rises to Comex Record for Fifth Day on Supply Concerns 2005-10-07 13:43 (New York) By Jennifer Itzenson Oct. 7 (Bloomberg) -- Copper rose to a record in New York for a fifth straight day as strikes and shut smelters in the U.S., Canada and Zambia renewed concerns that supplies will fall short of demand. Glencore International AG shut its Mufulira smelter in Zambia on Oct. 3 because of a fuel shortage. Asarco LLC, the second- largest U.S. copper producer, closed its Hayden smelter in Arizona for repairs on Oct. 2. Toronto-based Falconbridge Ltd. plans to use non-union workers to run its Ontario refinery because of a strike. ``Between Asarco being out, Falconbridge being out, and some of the smelter issues they're having in Zambia, the speculative community in part is expecting things to become tighter,'' said Joseph Gartland, vice president at Willow Grove, Pennsylvania- based H.M. Hillman Brass & Copper Inc., a supplier of parts to power plants and shipbuilders. Copper futures for December delivery rose 2.55 cents, or 1.4 percent, to $1.8085 a pound on the Comex division of the New York Mercantile Exchange. Prices earlier reached $1.809, the highest ever. The metal climbed 4.7 percent this week after gaining 8.4 percent in the previous two weeks. A futures contract is an obligation to buy or sell a commodity at set price by a specific date. Some analysts said that demand isn't strong enough to justify the recent rally in prices. Copper has surged 25 percent in the past five months. `Flying Solo' Copper ``seems to be flying solo, while both equity and energy markets have been selling off in recent days on concerns about weaker economic demand,'' Ed Meir, a commodity analyst with Man Financial Ltd. based in Darien, Connecticut, said in a report. ``A good-sized sell-off could ensue'' should economic concerns begin to outweigh the focus on strikes and declining inventories, Meir said. U.S. payrolls dropped by 35,000 in September, fewer than economists expected, based on the median forecast in a Bloomberg News survey. The decline followed a gain of 211,000 for August, higher than was previously reported, the Labor Department said. The jobless rate rose to 5.1 percent from 4.9 percent in August, the agency said. Copper's 14-day relative strength index, a measure of the metal's price momentum, climbed to 70 today, a level that indicates prices may be about to fall. The reading is up from 60 at the end of last week. The surge in prices has been led more by investors than users of the metal, Gartland said. ``The funds people are supporting it a little higher than it should be from an actual consumption standpoint,'' Gartland said. ``It's a supply issue, more than a demand issue.'' Global copper supplies have declined for seven straight sessions, helping to drive prices higher. Inventories monitored by the London Metal Exchange fell 1.4 percent today to 70,475 metric tons, the lowest in more than four weeks. Copper for delivery in three months on the LME rose $50, or 1.3 percent, to a record $3932 a ton ($1.784 a pound). --Editors: McKiernan, Enoch, McKiernan, Enoch.