Copper fell to a one-week low in London on speculation a recovery in demand for industrial metals will be delayed beyond the second half. Nickel, aluminum and zinc also dropped. A “severe” downturn will persist for most of 2009, Group of Seven finance ministers and central bankers said in a statement released after a Feb. 14 meeting in Rome. They represent about two-thirds of world economic activity and include Japan, where the Cabinet Office said today the economy shrank the most since 1974, and the U.S. “If you get such a negative statement from the G-7 finance ministers, not providing any glimpse of hope, it is negative,” said Peter Fertig, owner of Quantitative Commodity Research in Hainburg, Germany. “If they had emphasized that there are signs things are likely to get better in the second half, as we expect, that would definitely have been more positive for the metals.” Copper for delivery in three months dropped $88, or 2.6 percent, to $3,342 a metric ton at 10:41 a.m. on the London Metal Exchange. The contract slid as much as 3 percent to $3,326.50 a ton, the lowest since Feb. 5. The metal, which is used in plumbing and electrical wiring and viewed by some analysts as an indicator for global economies, has climbed 8.9 percent this year on speculation U.S. and Chinese economic-stimulus plans will revive demand. Copper may rebound to $3,500 a ton in a month, Fertig said. Larger Stockpiles Floor trading on the New York Mercantile Exchange’s Comex division is closed today for the Presidents’ Day holiday. May copper futures dropped 3 cents, or 1.9 percent, to $1.5245 a pound in electronic trading. Inventories of the metal in LME warehouses climbed 3,775 tons to 523,325 tons, the highest since Oct. 28, 2003, according to a daily report today. Mining companies’ shares were mostly lower. The FTSE 350 Mining Index dropped 2 percent, led by Kazakhmys Plc, the biggest Kazakh copper miner, and Rio Tinto Group. Hedge-fund managers and other speculators reduced their net- short position in New York copper futures for a second week in a row, according to U.S. Commodity Futures Trading Commission figures. A short position is a bet on lower prices. Short positions exceeded longs, or bets on higher prices, by 24,645 contracts as of Feb. 10, down from 25,238 contracts a week earlier, the Washington-based commission said Feb. 13. Nickel Retreats Nickel, mostly used in stainless steel, fell $125, or 1.2 percent, to $10,200 a ton, rebounding from a drop of as much as 2.4 percent to $10,075 a ton. LME-monitored stockpiles of the metal, mostly used in stainless steel, rose 1.2 percent to 90,402 tons, the highest since June 27, 1995, extending this year’s gain to 15 percent. OAO GMK Norilsk Nickel said today it would halt two units in Australia after nickel prices fell 80 percent in less than two years. “Based on announced closures to date, we now estimate that 28 percent of 2009 global nickel capacity has been curtailed,” Liberum Capital Ltd. analyst Michael Rawlinson wrote in a report. Lead fell $14 to $1,156 a ton, and aluminum dropped $6 to $1,371 a ton. Tin declined $270 to $11,100 a ton, while zinc lost $10 to $1,143 a ton.

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