Copper Gains for Fifth Session in N.Y. as Global Demand Climbs
By Millie Munshi
Aug. 23 (Bloomberg) -- Copper gained for a fifth session in New York, the longest rally in a month, as worldwide demand for the metal outpaced production.
Global consumption exceeded supplies by 216,000 metric tons in the first half, the World Bureau of Metals Statistics said yesterday. Imports in China, the world's biggest consumer of the metal, jumped 65 percent in July from a year earlier. Copper, used in pipes and wires, has gained 14 percent this year as usage increased in Asia.
``As long as China and India keep growing, they're going to keep using more copper and pushing the price up,'' said Michael Smith, president of T&K Futures & Options in Port St. Lucie, Florida.
Copper futures for December delivery gained 5.4 cents, or 1.7 percent, to $3.2765 a pound on the Comex division of the New York Mercantile Exchange. The metal has gained 6 percent in five sessions.
BHP Billiton Ltd., the world's largest mining company, said yesterday that ``demand growth from China is expected to remain robust,'' buoying commodity prices.
Far East Cable Co., China's largest cable maker, said it is running at full capacity to meet demand from the country's expanding power industry and may boost stockpiles of copper.
Cable makers are the biggest users of the metal in China, which plans to spend more than 1 trillion yuan ($132 billion) to expand its electricity grid under a five-year plan ending in 2010.
`Bull Market'
``We see continuing demand from India, China and from many other developing nations,'' Christopher Wyke, a commodities product manager at Schroders Plc in London, said yesterday. ``The underlying fundamentals for a continuation in the bull market are certainly there.''
Global copper consumption increased by 4.8 percent in the first half, as usage in China jumped 40 percent, the Ware, England-based World Bureau of Metal Statistics said. The deficit in the six months ended June compares with an 182,000 ton surplus for all of 2006, the group said.
Refined-copper imports in China climbed to 103,089 metric tons last month. Imports in the seven months that ended in July more than doubled to 1.03 million tons. The country has bought more copper in the past seven months than in the whole of 2006.
China has the world's fastest-growing major economy, and construction of power systems, offices and homes is surging. The price of copper has gained fourfold in the past four years, spurred by China's metal demand.
Cable Demand
Copper demand from Chinese cable makers will grow by as much as 9 percent a year, reaching 4.5 million tons by 2010, Yuan Genfa, secretary general of Shanghai Electric Wire & Cable Industry Association, said at a seminar in Yixing.
Still, increasing stockpiles may limit the metal's gains, Smith of T&K said. Inventories monitored by the London Metal Exchange rose for a seventh day to 123,800 tons, the highest since June 4.
On the LME, copper for delivery in three months gained $101, or 1.4 percent, to $7,251 a metric ton ($3.29 a pound). The metal rose to a record $8,800 a ton in May 2006.
MRX Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
