(1) Copper Supply Shortage Will Persist Until 2007, Bloomsbury Says 2006-02-20 10:47 (New York)
By Chanyaporn Chanjaroen
Feb. 20 (Bloomberg) -- Copper will see another two years of
supply shortfall this year and next because of ``strong''
consumption growth, London-based metals consultant Bloomsbury
Minerals Economics Ltd. said.
Copper demand will exceed production for the fourth
consecutive year this year, by 207,000 metric tons, and the
shortfall will widen to 249,000 tons next year, Peter Hollands,
managing director of Bloomsbury Minerals, said today in a report
released today.
--Editors: Wallace
(2) Copper Rises in London on Indications Stockpiles Will Decline 2006-02-20 10:35 (New York)
By Chanyaporn Chanjaroen
Feb. 20 (Bloomberg) -- Copper rose for a third consecutive
trading session in London on indications that stockpiles of the
metal will decline 13 percent in the next several weeks.
Traders bought as much as 13,775 metric tons of copper in
warehouses monitored by the London Metal Exchange and the metal
is no longer available, the exchange said today. Inventory,
including the metal already bought, stands at 105,800 tons, or
less than three days of global consumption.
``Consumers need to fill their inventories,'' Alastair
Clayton, chairman of South China Resources Plc, which explores
for copper in China, said today in an interview in London.
Chinese consumption may be rebounding after the week-long New
Year celebrations that ended Feb. 5, Clayton said. China is the
world's biggest copper consumer.
Copper for delivery in three months on the LME rose $72, or
1.5 percent, to $4,880 a ton as of 3:33 p.m. London time. Prices
had declined as much as $20, or 0.4 percent, before the stockpile
withdrawal data were released. Most of the withdrawals will take
place in Busan, South Korea, which is the closest LME-monitored
warehouse to China.
The Comex division of the New York Mercantile Exchange is
closed today to observe the President's Day holiday.
``The drawdown in stocks suggests we'll be back below the
psychological 100,000-ton threshold again,'' Robin Bhar, a
London-based analyst at UBS AG, said in a telephone interview.
LME copper stockpiles were last below 100,000 tons Feb. 10.
Copper on the LME is in backwardation, meaning prices for
metal for immediate delivery are higher than those for later
delivery. Normally prices for contracts with a later maturity are
higher to take account of costs including insurance and storage.
Metal Shortage
That backwardation has encouraged traders to simultaneously
sell contracts with nearby dates and buy contracts with longer
maturities, a process known as lending. They may now be taking
the metal back, again creating a shortage of metal for immediate
delivery, Bhar said.
Copper jumped 40 percent last year on the LME as demand
exceeded production by 241,000 tons, Citigroup said in a Feb. 7
report. The bank estimates there were deficits in 2003 and 2004,
years in which prices also rose.
Net-long positions, or bets prices will rise, fell by 3,149
contracts, or 84 percent, to 603 contracts as of Feb. 14, the
Washington-based Commodity Futures Trading Commission said Feb.
17. The Comex division of the New York Mercantile Exchange is
closed today for Presidents' Day in the U.S.
Among other metal for delivery in three months on the LME,
zinc rose as much as $69, or 3.4 percent, to $2,115 a ton,
posting the biggest gains among the six metals traded on the LME.
Zinc Positive
``The whole picture for zinc looks very positive'' because
of increased demand for the metal from China and India, South
China's Clayton said.
Goldman Sachs Group Inc. lifted it forecast for zinc by 16
percent to $2,163 this year, estimating demand to outpace supply
for a third successive year, by 330,000 tons. Zinc stockpiles
monitored by the LME have declined 43 percent in the past year.
Aluminum rose $36, or 1.6 percent, to $2,341 a ton. Nickel
rose $25, or 0.2 percent, to $15,125 and lead climbed $20, or 1.6
percent, to $1,245. Tin was up $175, or 2.3 percent, to $7,850.
--Editor: Wallace |
