SG:China slow economic growth having major effects on copper prices
Copper futures recorded the biggest weekly loss since mid December last Friday. Prices fell on increasing concerns that slowing economic growth in China, the world's top consumer may significantly drop demand. Five Star Equities examines the outlook for companies in the Copper Industry and provides equity research on Southern Copper Corporation and Lundin Mining Corporation.
The most actively traded contract for May delivery fell 9.35 cents or 2.5%, to settle at USD 3.6270 per pound on the Comex division of the New York Mercantile Exchange. This was the lowest settlement price since January 13th 2012. China reported the lowest growth rate in three years of 8.1% in the Q1 from the same period of last year.
Mr Dave Meger director of metals trading at Vision Financial Markets said that "Base metals are very closely tied to Chinese growth and, with growth coming in slower than expected, that's obviously relaying concerns regarding copper demand in the months ahead."
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Southern Copper Corporation in 2011 sales set a record of USD 6,818.7 million which is 32.4% higher than the previous year. This was the result of higher copper sales volume from Buenavista production and higher copper, silver and zinc prices.
Lundin Mining Corporation was pleased to announce that it has entered into a purchase option agreement to acquire an 80% interest in the Touro copper project located in northern Spain owned by two private Spanish companies. The Option Agreement gives Lundin Mining an exclusive option until October 1st 2012, subject to extension, to purchase an 80% interest in the Project, pending satisfactory completion of due diligence, including confirmatory and step out drilling and other technical work currently being conducted by the Company.
