FXS: UPDATE 3-LME copper heads for 2nd biggest weekly fall
SINGAPORE, Oct 24 (Reuters) - London copper futures fell 5 percent on Friday, their fifth straight day of losses, and with prices down almost 20 percent so far this week, the market is set for its second biggest weekly loss on record.
Growing worries the world is heading into a recession have caused copper prices to plummet an astonishing 39 percent in October and the metal will likely also see its biggest-ever monthly slide, surpassing the March 1980 fall of just over 24 percent.
Last week, prices dropped by just over 20 percent.
"There is still more room on the downside for all metals especially copper," said Judy Zhu, commodity analyst at Standard Chartered Bank.
London Metal Exchange copper for delivery in three months fell 5 percent to $3,840 a tonne by 0711 GMT, having touched a three-year low of $3,815 overnight.
"Copper prices are just starting to nibble at the top of the cost curve, but we have not heard of any major cutbacks in production," Zhu said.
She added prices could dip to $3,500 and even to $3,000, the bottom of Standard Chartered's cost curve estimates.
"Prices can fall below the cost of production and stay there for a while. We have seen it in aluminium and zinc and may see the same in copper, too."
Chile's state-owned Codelco, the world's largest copper miner, said the high price super cycle was over and it was taking measures to address slumping prices.
"The super cycle has come to an abrupt end," Codelco Chief Executive Jose Pablo Arellano said on Thursday.
ANOTHER RING OUT
The Shanghai Futures Exchanges will close positions on a number of copper and zinc futures contracts after they had fallen by daily limits for three consecutive days ended on Thursday.
Trade will resume on Monday, with the daily limit set to 4 percent for both copper and zinc, according to a statement published on the website of the exchange (www.shfe.com.cn).
The exchange did not disclose what percentage of the open interest will be closed out.
Shanghai copper stocks fell 3,737 tonnes, about 1,000 tonnes above expectations, to 31,053 tonnes in weekly data released after the end of trade on Friday.
For a graphic, click on: https://customers.reuters.com/d/graphics/GLBCPSTX241008.gif
LME zinc fell 6.7 percent to $1,120 and tin was quoted at $11,300, down 5.8 percent from Thursday's close.
Earlier on Thursday, three tin trades went through on the exchange's electronic platform at between $10,860 and $10,300. Dealers said the trades, which represented a 14 percent decline in prices, were suspect. An exchange official said the issue was under investigation, but declined further comment.
"Someone sent the wrong big figure in the price three times in a row," a dealer in Hong Kong said.
London nickel, the complex's big loser -- down more than 80 percent from a record high in 2007 -- fell $50 to $9,300.
* 3rd contact month for SHFE aluminium, copper and zinc (Editing by Ben Tan) Reuters 3000Xtra subscribers can access Metals Production Database by clicking on URL below http://mpd.session.rservices.com For related news and prices, click on the codes in brackets: LME price overview COMEX copper futures Base/minor metals news All metals news All commodities news Metals diary Foreign exchange rates SPEED GUIDES Keywords: MARKETS METALS
