Glencore Xstrata is Bullish on Copper, Predicts a Supply Shortage

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Copper or September delivery, the most actively traded contract, rose 2.9% to $3.1770 a pound yesterday on the Comex division of the New York Mercantile Exchange, its highest level since August 5.

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It was the largest one-day percentage gain since August 8, 2013.

Commodities trading house and miner Glencore PLC gave a bright view of the copper market, forecasting strong demand from both China and the West in the second half.

The company also said an expected glut of supply in the market would be tempered by shortages of scrap metal and the risk of disruptions from both new and old mines.

US copper producer grade 110 price saw a 2.4 percent increase on Thursday, August 21, reaching $3.88 per pound and making it the biggest mover for the day. The price of US copper producer grade 122 inched up 2.4 percent to $3.88 per pound. The price of US copper producer grade 102 increased 2.3 percent to $4.07 per pound. The Japanese copper cash price changed direction with a 0.1 percent drop. After two days of improving prices, the metal finished at JPY 742,000 ($7,155) per metric ton.

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Chinese copper closed mixed on Thursday. At CNY 51,670 ($8,416), the price of Chinese copper bar finished the market day up 2.1 percent per metric ton. The cash price of Chinese copper rose 2.1 percent to CNY 51,870 ($8,448) per metric ton. The price of Chinese copper wire saw essentially no change for the fifth day in a row, remaining around CNY 50,395 ($8,208) per metric ton. The price of Chinese bright copper scrap remained essentially flat at CNY 44,300 ($7,215) per metric ton.

The primary copper cash price closed at $6,921 per metric ton. Following a couple days of improvement, prices fell by 0.2 percent on the LME. The 3-month price of copper flattened at $6,905 after two days of improvement on the LME.

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