BS: Copper Rises to Five-Month High as Inventories Extend Decline
Sept. 17 (Bloomberg) -- Copper rose to the highest price in almost five months as inventories of the metal extended this year’s slide to the lowest level since November.
Stockpiles tracked by the London Metal Exchange have slumped 31 percent since Feb. 18 and declined for 30 straight weeks, including 0.8 percent today. Orders to draw metal from inventories posted the biggest weekly jump in four weeks. Copper is among the raw materials that will “break out to the upside in coming months,” Goldman Sachs Group Inc. said in a report.
“The market is increasingly aware of fundamental tightness in copper,” said Tom Kendall, an analyst at Credit Suisse Group AG in London. “Stocks keep being drawn down.”
Copper for delivery in December rose 2.05 cents, or 0.6 percent, to $3.514 a pound at 10:21 a.m. on the Comex in New York. A close at that level would leave prices up 3.2 percent this week. Earlier today, the metal touched $3.5525, the highest price for a most-active contract since April 26.
The daily tally of LME inventories showed a decline today of 2,950 metric tons to 384,200 tons, the lowest level since Nov. 5. Stockpiles slid 1.8 percent for the week.
Potential strikes by miners in Chile and Peru, the world’s largest copper producers, also “added to the bull sentiment,” Alex Heath, the head of industrial-metals trading at RBC Capital Markets in London, said in a daily report. Concern for supply “simply adds extra spice to a market already looking like it’s gearing up for its next big move,” Heath said.
Supply deficits probably will “quickly deplete” stockpiles over the coming year, Goldman Sachs analysts including Jeffrey Currie said today in a report.
Copper for delivery in three months rose $24.75, or 0.3 percent, to $7,724.75 a metric ton ($3.50 a pound) on the LME.
Tin gained 0.4 percent to $23,600 a ton after touching $23,800, the highest price since July 16, 2008.
Nickel, aluminum, lead and zinc also rose in London.
--Editors: Steve Stroth, Daniel Enoch.
To contact the reporters on the story: Anna Stablum in London at astablum@bloomberg.net; Yi Tian in New York at Ytian8@bloomberg.net.
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.
