The monthly Copper MMI® rose 1.1%, up to 91, for October, based on higher Chinese wire, scrap and cash prices and upticks on the LME.
So what were the primary drivers of the increase?
“Copper is reacting to macroeconomic factors such as the Federal Reserve’s decisions on quantitative easing (QE),” said Stuart Burns, co-founder and contributing editor of MetalMiner. “Copper price movements have been investor-driven, rather than by fundamentals.”
Copper Market Outlook
Based on MetalMiner data and how the markets are shaping up, the outlook for the copper sector appears to be rather murky. “Demand is opaque because a considerable amount of material is flowing into and out of inventory, much of which is not readily visible,” Burns said. “Supply, however, is increasing and the trend is likely to be down in Q4.”
Case in point: just recently, Chile’s government reported that 492,883 metric tons of copper were produced in August, a 7.6 percent increase from a year earlier, as production recovered at the Collahuasi mine and new projects came on-line.
Key Price Drivers of the Copper Index
Chinese bright copper scrap prices rose 2.3 percent to $6,997 per metric ton after rising the previous month. After rising the previous month, Chinese primary cash copper prices rose 0.3 percent to $8,789 per metric ton. Chinese copper wire prices rose 0.3 percent to $8,601 per metric ton after rising the previous month.
Korean copper strip rose 3.6 percent, sitting around $10.52 per kilogram.
The price of US copper producer grade 110 rose 2 percent over the past month to $3.99 per pound. The price of US copper producer grade 102 rose 1.9 percent over the past month to $4.18 per pound, the second straight month of gains.
The copper 3-month price closed the month up 0.3 percent on the LME at $7,295 per metric ton. At $7,570 per metric ton, the cash price of primary Japanese copper finished the month 2 percent higher.
The Copper MMI® collects and weights 12 global copper metal price points to provide a unique view into copper price trends over a 30-day period. For more information on the Copper MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.