Copper Climbs as Chinese Manufacturing Index Rises: LME Preview

By Jae Hur – Aug 22, 2013 12:43 PM GMT+0800

Copper led gains in industrial metals after a manufacturing index in China increased in August from an 11-month low, adding to signs the world’s second-biggest economy is stabilizing.

Market News:

Metals News:

Metals Prices:

-- Copper rose 1.1% to $7,320.50 a metric ton on the London
Metal Exchange. Relative strength index 61.
-- Aluminum gained 0.6% to $1,907.50 a ton. RSI 61.
-- Nickel climbed 0.7% to $14,520 a ton. RSI 54.
-- Lead added 0.7% to $2,228 a ton. RSI 65.
-- Tin was up 0.5% at $21,850 a ton. RSI 63.
-- Zinc advanced 0.2% to $1,971.75 a ton. RSI 64.

Other markets:         Last          % Change   % YTD
Bloomberg Dollar Index 1,028.99        +0.22       +4.31
Crude Oil               $103.72        -0.13      +12.96
Gold                  $1,361.53        -0.38      -18.73
MSCI World Index         366.22        -0.34       +7.79

Economic Events:
                                      Survey    Prior      Time
Euro-zone PMI Manufacturing    Aug      50.7     50.3      9:00
Euro-zone PMI Services         Aug      50.2     49.8      9:00
U.S. Initial Jobless Claims    Aug 17   330K     320K     13:30
U.S. Continuing Claims         Aug 10  2963K    2969K     13:30
U.S. House Price Index MoM     Jun      0.6%     0.7%     14:00




August 21, 2013, 8:20 p.m. ET

Copper Displays Strength

Higher Prices Follow Optimism About Demand and Economic Growth Overseas

The downtrodden copper market is showing signs of a turnaround amid a brightening economic outlook for the world’s two biggest consumers of the metal, China and Europe.

A flurry of relatively strong readings from the manufacturing and industrial sectors in both places has prompted many investors and analysts to revise global-consumption estimates for copper upward in recent weeks.


Bloomberg News

Prices of copper are up 9% since July 30. Above, copper cathode sheets in electrolytic tanks in Serbia.

The optimism about demand for copper, which is used in everything from smartphones to refrigerators to cars, has driven prices in the $100 billion futures market up 9% since July 30. Although prices have wavered in recent days amid nervousness about the Federal Reserve’s next policy moves, copper’s recent strength stands in contrast to its performance in the first half of the year, when prices sank 16%.

On Wednesday, copper futures for August delivery fell 0.8%, or 2.8 cents, to $3.3115 a pound on the Comex division of the New York Mercantile Exchange. Prices remain near two-month highs reached on Friday.

Hedge funds and other money managers as a group turned bullish on copper last week for the first time since February, according to the Commodity Futures Trading Commission. They had 7,041 more bets on copper prices rising than wagers on prices falling as of Aug. 13. In early April, investors were betting 38,951 contracts—a record high since at least 2006—in the opposite direction.

“Investors have turned more positive on growth—it’s as simple as that," says Clive Burstow, portfolio manager of Baring Asset Management’s $11.3 million Global Mining Fund. Mr. Burstow recently has boosted his exposure to copper by buying shares of copper-mining companies.

A surprise expansion in manufacturing activity in July in China, the world’s biggest copper consumer and importer, gave the rally its jump-start. The market maintained momentum as the latest Chinese trade and industrial-production data beat expectations and as the euro zone last week reported its first quarterly gain in gross domestic product since 2011.


China’s manufacturing report was a “huge turning point for copper," says Jason Rotman, president of Lido Isle Advisors, a commodities investment-management firm in Newport Beach, Calif. Mr. Rotman said the firm began placing bets on higher copper prices shortly after the manufacturing data was released.

To be sure, some say an onslaught of copper production from new mines—a factor in the selloff in the first half of the year—could continue to cause headwinds for prices. Global mine output in the second quarter was up 8.4% from the same period in 2012, Citigroup analysts said in a note, the fifth straight quarter in which production beat year-earlier levels.

And there is potential for the next ream of Chinese economic data to disappoint. A preliminary reading on the country’s manufacturing activity in August is slated for release on Thursday.

Analysts with Credit Suisse said in a note on Tuesday that copper supply will likely exceed demand in the months ahead, citing the chance that this summer’s gains in demand from Chinese auto makers and home builders will prove fleeting.

“Reading too much into one month’s data can be misleading," the analysts wrote.

Still, bullish investors point out that, not only are copper-demand forecasts being raised, but supplies already are tightening.

Copper stockpiles held in warehouses certified by the London Metal Exchange have declined 16% since late June, a sign of increased demand from manufacturers.

Rising investment in copper-heavy projects such as providing electricity to rural areas and railway expansion mean China’s refined copper consumption is set to rise 9.1% this year, analysts at Morgan Stanley estimate, up from 5% growth in 2012. They expect copper supply to exceed demand by just 53,300 metric tons this year, down from projections for a 124,400 ton surplus at the start of the year.

“Copper’s resilience suggests that the worst is behind us," says Sameer Samana, a senior international strategist with Wells Fargo Advisors, which manages about $1.3 trillion in assets. “If China was really in as bad of a shape as people have been saying, you would have seen a much bigger pullback" in copper and other industrial metals.




我覺得呢排尐資源股已經郁咗一段短時間,如果呢個時候仲唔上車,我覺得之後去到「火棒傳遞區」先諗買唔買,第一輸嘅當然係價位,但呢點其實唔緊要,注碼先係最緊要,升到RSI過70樓上,你仲敢唔敢大注渣落去?你唔敢大注渣,已經限制咗你嘅POTENTIAL PROFIT。當然,你唔昅實個市,慢幾怕先留意到,咁只能再努力尐啦~





[神州股票資訊]F T:銅市轉牛跡象——廢銅緊缺

@ 2013-06-15 18:00:48















世界最大的上市廢銅商行Sims Metal Management亞洲主席Michael Lion表示,一些存在廣泛交易的高品位廢銅對倫銅價格的折讓,已經跌至了數年來的最低水平。


巴克萊金屬分析師Gayle Berry表示,市場的壓力還會進一步放大,因為中國的冶煉廠要求一定比重的廢銅,才能避免它們處理低品位銅礦石時不會出現過熱的情況。





本篇發表於 , 個股研究 並標籤為 。將永久鏈結加入書籤。

1 Response to Turnaround第二擊!今次係江西銅業股份(358)

  1. fatlone 說道:


    It’s copper’s turn to shine
    BY:BARRY FITZGERALD From: The Australian August 27, 2013 12:00AM

    Copper demand is benefiting from the electrification of developing countries such as China. Picture: Getty Images Source: Supplied

    Source: TheAustralian

    LIKE the oversold iron ore and gold sectors before it, copper has provided fleet-of-foot traders spectacular share price gains in the past couple of months.

    Sold off strongly in the first six months of the year for good reason (the copper price tanked 16 per cent to a low of $US3.02 a pound on June 24), copper stocks have since been putting on some big gains in response to a price recovery to about $US3.37 a pound, more if the impact of the fall in the Aussie dollar is factored in.

    In iron ore there was supposed to be a dramatic price crash in the current half as global seaborne trade caught up with demand.

    But the price has powered ahead to $US139 a tonne, up substantially from the $US90 a tonne many pundits thought would be the case by now.

    Gold got slammed to as low as $US1200 an ounce in early June and, despite predictions it had $US1000 and lower written all over it, it has worked its way back since to be knocking on the door of $US1400 an ounce.

    So three of the key commodities that drive sentiment in this (mining) market have been making the commodity price forecasters out there all look a bit silly, with copper being the latest. Will the present oversupply drive the price down to $US2.60 in the near term, or will those making a $US3.50 call for this year and next win the day?

    If those backing further falls are proved wrong – and this looks to be happening – then copper stocks could well be expected to build on their recent gains, remembering of course that most are still trading below where they were last year when the copper price average $US3.61 a pound.

    In the junior explorers-developers sector, no one should be buying them on the basis of the here and now in copper prices.

    Their main attraction is for about 2017-18 when the next generation of copper mines will be needed to replace depleted mines and offset forecast lower grades at the fleet of ongoing operations, as well as to meet growth in demand from the developing world’s electrification push.

    The way the commodity forecasting unit at Rio Tinto sees it, the “slight" surplus in the copper market is likely to persist for the next 12 months, with new mine supply volume coming online and few signs of strong demand acceleration.

    But further out it expects significant supply challenges, with miners facing lower grades, stakeholder pressures and project delays.

    And that is why much of the money that has come back into the copper juniors in the past couple of months has been as much about the rebound in copper prices to a respectable $U3.37/lb as it has been about positioning to the predicted tightness in copper markets to come in 2017-18, and the need for prices to be at a level to motivate new production.

    The fancy prices being paid in recent copper asset transactions such as the $US820 million ($908m) Rio got for its unwanted Northparkes copper-gold mine in NSW feeds into the argument that, of all the metals, copper has the best fundamentals as there is not a lot of supply coming on to meet the steadily increasing demand.

    So juniors that have their foot on something big in copper, albeit undeveloped at this stage, can rest assured that they will have their day in the sun.

    Metminco (MNC)

    THERE is no better example of the spectacular gains made by the fleet-of-foot in the copper sector in the past couple of months than the ASX-AIM listed Metminco, owner of the Los Calatos copper-molybdenum porphyry discovery in the deep south of Peru.

    On July 3 it was trading at the princely price of 1.1c a share. Yesterday it was 5.3c, a gain of 380 per cent if you don’t mind. So for those who bought around the July low, Metminco has been wonderful. Mind you, it has to be remembered that it was a 9c stock a year ago, so longer-term holders have lost some real value.

    That’s why there is that repeated reference to being fleet-of-foot in this market. There is no point holding a stock that is on the skids because momentum is against it.

    That was certainly the case with junior copper stocks in the June half. But as argued above, momentum has now swung the other way, for the time being at least.

    At its present price, Metminco is a $100m company. That in itself says that Metminco Los Calatos is something meaningful.

    The company also has responded to the cooling in the price of copper and other commodities since the giddy heights of 2011 – prices are still at historically high levels – by reworking the numbers on Los Calatos.

    The upshot of all that is Los Calatos has the potential to mine 800 million-plus tonnes of ore across 34 years for production of about 100,000 tonnes of copper annually (plus molybdenum, gold and other by-products), at a life-of-mine cash operating cost of $US1.06 a pound after by-product credits.

    The optimisation exercise has increased the life of the planned initial open pit stage from seven years to 14 years, and reduced the project start up capital expenditure from $US1.5 billion to $US1.32bn. While a welcome reduction, that final figure is still a big hurdle to overcome.

    But given Metminco is being valued at next to nothing for its copper in the ground, the task of it finding a funding partner for the project is made all that easier.

    Hot Chili (HCH)

    HOT Chili is another Latin American copper explorer-developer that had its share price beaten up something shocking, with the stock coming back from 78.5c in late January to a low of 40c earlier this month.

    But it, too, has rebounded. Not as sharply (in percentage terms) as Metminco but the 12.5 per cent move up from 40c to 45c a share in the past couple of weeks is not to be sneezed at.

    Hot Chili continues to work away at delivering a pre-feasibility study in the first half of next year in to the $US500m-$US700m development of its Productora copper deposit in northern Chile’s Atacama region.

    First production from 2017 at an annual rate of more than 55,000 tonnes of copper and 42,000 ounces of gold at cash costs of $US1.20-$US1.50 a pound of copper (after gold credits) is the broad aim.

    More telling for Hot Chili’s chances is the strong relationships it has with mining majors in Chile, and the access to critical infrastructure those relationships bring.

    It’s why any number of existing copper producers looking for growth opportunities, including Lundin Mining and our own OZ Minerals and PanAust, are all said to be potential acquirers of the project.

    But they won’t get it at these prices.



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