BLBG: Copper Falls to One-Week Low in London as Stockpiles Expand
Copper fell to a one-week low in London, dropping for a third consecutive day, as expanding stockpiles of the metal signaled worsening demand. Aluminum rebounded from a five-year low.
Inventories of copper in warehouses monitored by the London Metal Exchange rose 1.2 percent to 422,450 metric tons, the highest since January 2004. The economy in China, the largest user of the metal, grew 6.8 percent in the last quarter, the slowest pace in seven years, the statistics bureau said today.
“We’re still not so positive on metals in the first half because of inventory buildup,” Thomas Benedix, an analyst at Tiberius Asset Management AG, said today by phone from Stuttgart, Germany. “Demand is really bad.”
Copper for delivery in three months on the LME dropped as much as $50, or 1.6 percent, to $3,170 a ton, the lowest intraday price since Jan. 13. The contract traded at $3,187 as of 11:32 a.m. local time.
Copper has trimmed this year’s gain to 4.5 percent, after slumping 54 percent in 2008. BHP Billiton Ltd. will delay $6.75 billion in projects at Escondida in Chile, the world’s largest copper mine, Diego Hernandez, president of the industrial metals division, said yesterday.
China’s refined copper imports jumped 49 percent in December from the previous month, customs data today showed. They fell 2 percent in 2008, to 1.456 million tons.
Five-Year Low
Aluminum rose $18.50, or 1.4 percent, to $1,353.50 a ton, after trading at $1,330 yesterday, the lowest since April 2003. Aluminum Corp. of China Ltd., the nation’s biggest producer of the metal, said profit plunged more than 50 percent last year.
Open interest, or outstanding contracts, in aluminum futures fell to 662,724 lots (16.6 million tons) as of Jan. 20, the lowest since November 2007. It rebounded to 665,519 contracts yesterday. A decline in open interest that coincides with a price drop indicates traders and investors sold positions.
Among other LME metals, lead gained $11 to $1,098 a ton, nickel added $245 to $11,150 a ton and zinc fell $8 to $1,135 a ton. Tin decreased $250, or 2.2 percent, to $11,350 a ton.
