Komesaroff: No Rebound for Chinese Copper Until 2016

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The falling copper price — which has held its value much better this year than its metal peers, down just 8% so far — will not bounce back any time soon, due to a series of one-off developments in China, which consumes 40% of the world’s production, Roman Callick of The Australian writes.

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That is the verdict of Michael Komesaroff, a leading Australian expert on China’s mining industry — a former Rio Tinto executive in Asia, who then worked for a major Chinese resource corporation — writing in new analysis for China-based GavekalDragonomics.

Over the past 10 years, he says, China’s consumption of ­refined copper has almost tripled, while consumption in the rest of the world has contracted by 6%.

The price of US copper producer grade 110 saw a 0.8% increase on Thursday, October 2, reaching $3.74 per pound and making it the biggest mover for the day. The price of US copper producer grade 122 inched up 0.8% to $3.74 per pound. The price of US copper producer grade 102 increased 0.8% to $3.93 per pound. Following a two-day rise, the Japanese copper cash price flattened at JPY 774,000 ($7,100).

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Chinese copper prices closed flat for the day. Chinese copper bar saw little change in its price yesterday at CNY 49,720 ($8,100) per metric ton. The cash price of Chinese copper held steady on Thursday, remaining around CNY 49,920 ($8,133) 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 ($8,210) per metric ton. The price of Chinese bright copper scrap saw little movement at CNY 44,300 ($7,217) per metric ton.

The 3-month price of copper is back up, rising by 0.4% on the LME yesterday to close at $6,710 per metric ton. Also on the LME, the primary copper cash price inched up 0.3% to $6,755 per metric ton.

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