BLBG: Copper Rises as Imports Into China Increase for First Time in Three Months
Copper rose in London on speculation that demand remains intact in China, the world’s largest consumer, after imports of the metal into the country gained for the first time in three months.
Inbound shipments of copper and products advanced 29 percent to 351,597 metric tons in November, customs figures showed today. The metal is on course for a second weekly climb in London, helped by today’s introduction of the first exchange- traded product backed by copper. Other ETPs holding tin and nickel also are scheduled to debut today.
“The level of Chinese refined imports has a significant impact on the market,” said Daniel Major, an analyst at RBS Global Banking & Markets in London. “Positive investor sentiment toward copper is likely to be supported by the launch of the first physically backed copper ETF” and two New York- listed funds planned for next year, he said.
Copper for delivery in three months climbed $85, or 0.9 percent, to $9,035 a ton at 10:08 a.m. on the London Metal Exchange. The contract reached a record $9,091 yesterday. Copper for delivery in March added 0.8 percent to $4.121 a pound on the Comex in New York.
China’s government is moving to curb inflation that reached a two-year high in October. Expectations that interest rates in the country may rise as soon as this weekend intensified this week as the government advanced the release of November economic figures to Dec. 11.
‘Bullish Outlook’
“We remain concerned about the impact of tightening measures in China on real copper demand in the first half of 2011,” Major said. “However, inflation concerns in China and the underlying bullish outlook for the copper market are likely to limit the release of stockpiled material from private speculators in the near term, reducing downside risks.”
November copper imports into China were 21 percent higher than a year earlier, according to Bloomberg data. In October, shipments fell for a second month to a one-year low. Total inbound deliveries in this year’s first 11 months gained 0.7 percent to 3.95 million tons.
“The slump of imports in October has thus proven to be a temporary phenomenon,” Commerzbank AG said in a report today. “Given the large-scale investments in infrastructure, China is likely to continue to import high quantities of copper and thereby support prices.”
Record Exports
Other figures showed that China’s exports and imports surged to record levels in November, backing the case for additional measures to cool asset prices in the world’s largest user of industrial metals. Overseas shipments rose 35 percent from a year earlier and imports climbed 38 percent, the customs bureau said today.
Copper also gained as LME inventories, down 31 percent this year and headed for the first annual drop since 2004, rounded out a 42nd straight weekly contraction. Stocks slipped to 348,625 tons today, leaving them down 1.4 percent for the week, the most in 10 weeks.
The first trades had yet to take place in ETFS Physical Copper, ETFS Physical Tin and ETFS Physical Nickel. ETF Securities Ltd., whose managers started the world’s first gold- backed ETP, announced the funds’ introduction on Dec. 7.
Tin for three-month delivery on the LME rose 0.4 percent to $25,999 a ton. Prices reached a record $27,500 on Nov. 9. The metal has jumped 53 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of Congo.
Aluminum added 0.2 percent to $2,343 a ton and nickel climbed 0.4 percent to $23,701 a ton. Lead gained 1 percent to $2,430 a ton and zinc was unchanged at $2,300 a ton.
To contact the reporter on this story: Maria Kolesnikova in Moscow at mkolesnikova@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter@bloomberg.net.
