Thomson Reuters: Copper Faces More Price Weakness in 2015

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An update to the 2014 edition of the Thomson Reuters GFMS Copper Survey, released on Wednesday, found that the price of the metal was approaching marginal production cost levels of around $6,000/ton, remaining below the incentive price for the metal, which it estimated at around $7,450/ton.

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“More recently, a series of weaker economic data, falling Chinese refined copper imports and a stronger dollar have also weighed on prices,” according to the report. ““The primary risk to the copper sector appears to come from a hardening in the government’s attitude towards credit in China. While this prudence will ultimately be beneficial in reducing the investment bubbles and overheated sectors that have been a feature for many years, it could cause a temporary slowdown in offtake.”

The price of US copper producer grade 110 saw the biggest increase at 1.3%, finishing at $3.79 per pound for Wednesday, October 15. The price of US copper producer grade 122 gained 1.3% to finish at $3.79 per pound. At $3.98, the price of US copper producer grade 102 finished the market day up 1.3% per pound. The cash price of primary Japanese copper weakened by 0.7%, settling at JPY 756,000 ($6,944) per metric ton.

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Chinese copper prices were mixed for the day. Chinese copper bar saw its price rise 0.5% to CNY 49,650 ($8,084) per metric ton. The cash price of Chinese copper increased 0.5% to CNY 49,850 ($8,117) per metric ton. The price of Chinese copper wire held steady at CNY 50,395 ($8,205) per metric ton. For the fifth day in a row, the price of Chinese bright copper scrap remained essentially flat at CNY 44,300 ($7,213) per metric ton.

The cash price of primary copper saw a 0.3% decline on the LME to $6,780 per metric ton. The 3-month price of copper saw little movement yesterday on the LME, closing out around $6,728 per metric ton.

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