Copper is expected to show some upside move in MCX. The conducive sentiments in Shanghai and LME will help Copper opening higher from the sober moves in last week of 2011. The Shanghai Copper contract for March expiry ended 2011 trading with gains of 1040 yuan at 55360 yuan per ton. Meanwhile, Copper on LME was also up by 1.7% after closing at $ 7568 per ton. However the prices still went down with losses of 22% in 2011. On MCX, Copper closed at Rs. 406 per kg. The MCX futures registered a fall of more than 9% since January 2011 while LME forwards were down by 22.5% during 2011.
Home sales in US and China will be the key in coming months for the demand of Copper. One has seen softness in demand and rising home inventories. China home prices have started to soften up from the top. China manufacturing growth is getting slow and the demand will be impacted due to that. China is the world largest consumer of Copper.
China saw a rise in November refined imports of Copper though the real reason behind the rise was not end user demand. Refined Copper imports of China in November increased by 16.5% to 343926 tons. The Copper imports in China were at record highs of 378943 tons in June 2009. However on a cumulative 11 month period the imports of refined Copper declined by 9.9% to 2.43 million tons. The reason behind the rise of imports in November was that Chinese traders are using favourable arbitrage opportunities to buy Copper.
