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Markets

Copper price at highest since August 2008

By Li Xiaowei (China Daily)
Updated: 2010-04-13 11:44

SHANGHAI: Copper jumped to the highest price since August 2008 in London after imports by China surged in March on rising seasonal demand.

The three-month contract on the London Metal Exchange rose as much as 1.5 percent to $8,043.75 a metric ton in early trade, the highest level since Aug 1, 2008.

The contract rose above $8,000 last week for the first time since the collapse of Lehman Brothers Holdings Inc in September 2008.

Imports of copper and products by China jumped to 456,240 tons last month, the customs office said on April 10. That's 42 percent more than February's 322,280 tons and 22 percent more than March 2009, according to Bloomberg calculations.

"Such a big increase is likely to be interpreted by overseas investors as robust Chinese demand and a key reason to buy," said Zeng Chao, an analyst at Everbright Futures Co, from Shanghai. "Yet higher shipments would boost supplies within China and pressurize domestic prices."

Copper for July delivery on the Shanghai Futures Exchange climbed as much as 1.4 percent to 63,790 yuan ($9,347) a ton, the highest level since July 2008. The contract closed unchanged at 62,930 yuan.

Prices gained even as copper stockpiles monitored by the Shanghai exchange expanded 10 percent last week to the highest since at least 2003.

"As we are in the manufacturing high season, any sign of rising demand fuels buying, whereas signals of expanding supplies are ignored," said Zhang Wenhai, an analyst at Luneng Jinsui Futures Co.

Weak dollar

Metals also climbed as the dollar fell against a basket of six major currencies for a second day, improving the appeal of commodities as alternative investments.

The dollar declined against the euro after European governments offered Greece a rescue package worth as much as 45 billion euros ($61 billion).

Aluminum rose as much as 1 percent to $2,431 a ton, the highest price since October 2008. China's imports of aluminum and its products rose 48 percent to 95,046 tons last month, according to customs data.

Norsk Hydro ASA, Europe's third-largest aluminum producer, will likely shut its Neuss smelter in Germany because of the high cost of electricity, the company's Chief Financial Officer Jorgen Arentz Rostrup said. United Co Rusal, the largest aluminum producer, said on Monday it will raise output by 3 percent this year.

Nickel advanced as much as 1.7 percent to $25,634 a ton. BHP Billiton Ltd, the world's largest mining company, suspended its Nickel West Leinster operations in Western Australia after a worker was killed.

Lead gained as much as 1.2 percent to $2,359 a ton, the highest price since February. Zinc climbed 0.6 percent to $2,430 a ton and tin was little changed at $18,750 a ton in early trade in London.