BLBG: Copper Climbs for a Third Day in Asia as Inventories Continue to Contract
Copper rose for a third day in London as inventories continued the longest streak of declines in more than a year, signaling steady demand.
Copper stockpiles tracked by the London Metal Exchange shrank for a 24th day today, the lengthiest run since a 40- session streak that ended on July 2, 2009, data compiled by Bloomberg shows. Immediate-delivery metal’s discount to the three-month price was unchanged yesterday at $15.25, compared with $21 a week ago.
“The end of the third quarter could well see the spread trading near zero as global demand improves and we see even deeper inventory draws,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said in a note today.
Copper for delivery in three months added $119, or 1.8 percent, to $6,760 a metric ton at 10:13 a.m. on the LME. Futures for September delivery gained 1.6 percent to $3.05 a pound on the Comex in New York. All of the six main metals traded on the LME climbed.
LME-monitored copper inventories fell to 417,625 tons, the lowest level since Nov. 18. They’re down 17 percent this year and headed for the first annual drop since 2004. Bookings to remove copper from LME warehouses rose for a second day, gaining 1.3 percent to 33,475 tons, the most since July 7.
U.S. Economy
Prices are up 3.8 percent this month in London, rebounding from the second quarter’s 16 percent drop. Copper slid on a stronger dollar and concern that the economic rebound in the U.S. might be weaker than expected. Federal Reserve Chairman Ben S. Bernanke will today speak on the economy before the Senate Banking Committee.
“We are just waiting for the news from the Fed,” Marc Elliott, an analyst at Fairfax IS in London, said today by telephone.
The Fed on July 14 cut its forecast for economic growth in the U.S. this year to between 3 percent and 3.5 percent from the prior 3.2 percent to 3.7 percent. The country is the world’s second-biggest copper user after China.
Imports of refined copper into the Asian nation fell for a third month in June as lower domestic prices discouraged overseas purchases and local output surged. Inbound shipments were 211,957 tons, the Beijing-based customs office said today. That’s 24 percent less than in May and 44 percent less than a year earlier, according to Bloomberg calculations.
Aluminum for three-month delivery on the LME rose 1 percent to $1,989.75 a ton. Orkla ASA said its Aluminium Solutions unit expects improvement in most North American markets this year, except for the building and construction industry. Housing starts in the U.S. fell to an eight-month low in June, government figures showed yesterday.
“The market is also showing growth in Europe, although the outlook is more uncertain, especially in southern Europe,” Oslo-based Orkla said today.
Lead advanced 0.7 percent to $1,851 a ton and nickel climbed 1.1 percent to $19,325 a ton. Zinc added 0.3 percent to $1,880 a ton and tin gained 0.6 percent to $18,350 a ton.
To contact the reporter on the story: Anna Stablum in London at astablum@bloomberg.net.
