Copper stockpiles in bonded warehouses in China have dropped about 50 percent this year, said Glencore International Plc, the world’s biggest listed commodities trader. The decline partly reflects tighter financing conditions facing “various market participants,” Baar, Switzerland-based Glencore said today in a statement as it reported a 57 percent jump in first-half profit. “Adjusting apparent demand for the significant inventory drawdowns we have seen in China during the first half 2011, one can conclude that real demand has been and continues to be strong,” Glencore said. “Mounting risks to supply, particularly in the copper concentrate market,” should support prices, it said, predicting copper, zinc and lead end-user demand will remain “relatively firm” in the second half. Glencore sold 17 percent less copper metal and concentrates in the first half than a year earlier. While demand for industrial metals in the U.S. and Europe was “constrained” by poor supply growth, German usage was “particularly strong,” mainly because of stronger export demand, the company said. Premiums buyers are prepared to pay for aluminum are being supported by inventory financing transactions and “logistics bottlenecks,” Glencore said. The company said it will stay focused on warehousing activities. Glencore’s first-half alumina and aluminum sales rose about 16 percent to 6.5 million metric tons. “Market conditions in aluminum have generally been favorable,” the company said. Glencore said it will continue to seek “long-term” supply contracts with existing partners, while also seeking “new business opportunities with smelters being opened in the Gulf and elsewhere.” To contact the reporter on this story: Agnieszka Troszkiewicz in London at atroszkiewic@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

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