Copper rose for a second straight day after a report showed economic growth in China, the world’s largest user of the metal, topped economists’ estimates.
China expanded by 9.6 percent in the third quarter, above the median 9.5 percent estimate of economists surveyed by Bloomberg News. Gains in the Asian nation’s metal use will be “robust,” according to Rio Tinto Group, the world’s third- largest mining company. Before today, copper prices jumped 13 percent in New York this year.
Chinese metals “consumption is fairly strong,” said Michael Jansen, an analyst at JPMorgan Securities Ltd. in London.
Copper futures for December delivery rose 4.7 cents, or 1.2 percent, to $3.8405 a pound at 9:56 a.m. on the Comex in New York.
Chinese construction of cities, homes and factories will support metals demand even as economic expansion slows, Ian Bauert, Rio Tinto’s China managing director, said in an interview today in Shanghai.
Global copper demand probably will outpace supply by 180,000 metric tons this year, with the deficit widening to 482,000 tons next year, JPMorgan’s Jansen said.
“The Chinese demand stories are still out there,” said Frank Lesh, a trader at FuturePath Trading in Chicago. “China’s economy is still expanding, and China’s the big mover on copper right now.”
Supply Shortfall
Copper stockpiles monitored daily by the London Metal Exchange fell 0.2 percent to 370,000 tons, down 26 percent this year, data show. Orders to draw copper from LME inventories, or canceled warrants, rose 12 percent to 28,475 tons, the highest level since Sept. 22, for a two-day jump of 28 percent.
In London, copper for delivery in three months rose $96.50, or 1.2 percent, to $8,436.50 ($3.83 a pound) a ton. Aluminum, lead, tin and zinc also gained. Nickel fell.
To contact the reporters on the story: Anna Stablum in London at astablum@bloomberg.net; Pham-Duy Nguyen in Seattle at pnguyen@bloomberg.net.
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
Source: http://www.bloomberg.com/news/2010-10-21/copper-may-rise-on-weaker-dollar-stronger-than-estimated-chinese-growth.html
