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Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (38457)	6/11/2009 7:50:52 PM
From: LoneClone	Read Replies (1) \| Respond to of 195238

Copper demand still weak outside China – Freeport's Adkerson miningweekly.com By: Liezel Hill 11th June 2009 Updated 7 hours ago TORONTO (miningweekly.com) – Although Chinese buying is keeping copper supplies tight, demand for the industrial metal from developed countries remains weak, Freeport-McMoRan Copper & Gold CEO Richard Adkerson said on Wednesday. After copper prices fell sharply late last year, Freeport acted quickly to cut back on higher-cost production of copper and molybdenum, reduce its payroll and aggressively manage costs at the operations that were still running. Other copper-miners around the world also curtailed operations in response to the weak market and this, coupled with a lack of new resources to develop, has produced a situation where global copper inventories are low by historical perspectives. “So, we've had this sort of anomaly, of having a dramatic drop in prices, and yet still having a tight physical marketplace,” he said at a mining conference in Toronto. “And that is very positive for copper.” So far this year, gains in the copper price have been supported by Chinese buying, and “the near-term price is going to be driven by events in China,” Adkerson said. However, he rejects the argument that it is just inventory buying, not supported by real consumption. China's economy is growing, and the country is spending huge amounts of money on infrastructure projects that require copper, he said. However, in North America, Europe and Japan, copper demand continues to be weak, Adkerson said. For this reason, the company is not contemplating restarting production that it took offline when prices fell, despite the recent gains in the copper price. “It's more complicated than a price point. The price today, is at a level where you could justify bringing potentially everything we shut down back on stream,” Adkerson commented. However, until the rest of the world starts buying copper again, the risk exists that China could suddenly change its buying practices and the copper price would drop. “I'm not saying they will, but there is a risk,” he said. “Without seeing recovery of demand in North America, and the developed world, we are going to continue to operate in the mode that we're at now."