BLBG: Copper Heads for Worst Week Since 1986 on Global Growth Concern
By Glenys Sim
Oct. 3 (Bloomberg) -- Copper headed for its worst week in more than 20 years on increasing concern that slower global economic growth may cut demand.
Copper fell for a fifth session yesterday, as the euro fell to a one-year low against the dollar after European Central Bank policymakers considered cutting rates. Commodity investors are also concerned the post-Olympics bounce in Chinese economic activity has been ``tepid at best'', according to Commonwealth Bank of Australia's David Moore.
Copper for delivery in three months fell as much as 0.5 percent to $5,860 a metric ton on the London Metal Exchange, and was little changed at $5,860 at 11:40 a.m. in Singapore. The metal used in wires and pipes slumped to $5,785 yesterday, the lowest since February 2007. It is down 14 percent for the week, the largest weekly drop since at least 1986.
December delivery copper on the Comex division of the New York Mercantile Exchange added 0.8 percent to $2.6475 a pound at the same time. China's markets are closed this week for holidays.
Labor disputes threatening to disrupt supply this week failed to stem the metal's losses.
Workers at Freeport-McMoRan Copper & Gold Inc.'s Cerro Verde unit yesterday began their second walkout of the year, union General Secretary Luis Castillo said in a telephone interview.
About 700 workers at Xstrata Plc's copper and zinc operations in Canada left their posts Oct. 1 after wage negotiations stalled.
The parties are negotiating wages and benefits and are not ``that far apart,'' Canadian Auto Workers negotiator Hemi Mitic said yesterday.
``Although the shorts are in control for now, ongoing critically low global stocks and endemic production problems suggest prices could turn very sharply if Chinese restocking materializes in the fourth quarter,'' Hussein Allidina, commodity research analyst at Morgan Stanley in New York said in an e- mailed report today.
Among other LME-traded metals, aluminum rose 0.2 percent to $2,305 a ton, zinc added 1 percent to $1,595, and lead gained 1.5 percent to $1,720. Nickel and tin had not traded.
To contact the reporter for this story: Glenys Sim in Singapore at firstname.lastname@example.org