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

To: Stephen O who wrote (1855)	10/15/2007 7:35:26 PM
From: TheSlowLane	Respond to of 2131

Copper to $9,000 - upside underestimated Copper specialists Bloomsbury Mineral Economics believe that we can expect copper prices to reach $9,000 a tonne within the next two years. Author: Lawrence Williams Posted: Friday , 05 Oct 2007 LONDON - In a presentation at Mining Journal's 20:20 Copper Day in London, Chris Welch of copper specialist analytical service, Bloomsbury Mineral Economics (BME), made a strong case for copper reaching $9,000 a tonne - $4.08 a pound - by 2009. Given that BME has a great track record on copper price predictions such a prediction should not be taken lightly! The premise behind the prediction is that the supply gap is continually underestimated by many analysts and factors which should be built into their pricing models are often excluded. Notably Welch feels that mine production is invariably over-estimated, and the figures also do not take into account the amount of copper or concentrate which is, at any given time, tied up in working stocks, and material in transit and being processed. This effectively means that even if, for example, metal production moves into a small surplus, as is possible in 2008, the amount that is actually available to the market is somewhat less than this and helps maintains the copper price at current levels. The stock low point is likely to occur late this year, but copper availability is still likely to be in commercial deficit through 2008 and 2009 and may achieve balance in 2010. This is the basis for the BME price prediction of $9,000 copper by the end of 2009. This scenario - or at least the general overestimation of copper mine production by analysts - was also commented on by another speaker, Justin Longley of International Copper Resources. He showed a most interesting chart of analysts' predictions against real output which showed a huge divergence, based on figures from Xstrata. The point perhaps that both speakers were making is that individual corporate presentations of copper mine supply are frequently heavily overestimated but many analysts may take these as reality without applying a big enough discount for projects which are cancelled, fall behind schedule or for major supply disruptions for technical, political and labour reasons. Real growth in copper consumption remains very strong, older mines are becoming depleted and grades are declining sharply. Another interesting point which arose in Longley's presentation was the rate of copper usage per capita in the Asian sector in particular. It was pointed out that growth in Taiwan and South Korea has been very high in relation to the developed nations where the curve was lower because of the existing copper based infrastructure. But in the real growth economies like China and India, this growth pattern has hardly started yet, and should this rise to Korean or Taiwanese levels then the effect on the$ supply/demand pattern could enormous with price development which could make $9,000 copper itself a huge underestimate!

To: Stephen O who wrote (1855)	10/25/2007 1:28:20 PM
From: TrueScouse	Read Replies (3) \| Respond to of 2131

Stephen: A few thoughts about "rolling over" my copper stocks -- which have been very successful mainly due to your initial heads up on First Quantum (FM). Thanks! Following the Cambridge House TRIC conference I've taken new positions in Equinox (the warrants -- EQU.WT,T) and El Nino (ELN,V). I used to own First Quantum but sold to buy Anvil, and now I've sold half that to buy these. But there's more than a casual progression! ELN is actually run by the guy who formerly got FM moving in the DRC. And they've got a great land position and are just starting drilling. I'd appreciate your opinion on it. And EQU I'm sure you know -- a soon-to-be-producer in Zambia. Massive project. I decided to reduce my DRC risk by putting some of the funds into Zambia. I'd be interested in your thoughts on these. TIA. Best regards, Howy