copper prices on the rise..Copper Prices Surge to 16-Year High on Global Supply Concerns
June 3 (Bloomberg) -- Copper prices in New York rose to the highest in 16 years on expectations that demand will outpace production, eroding global inventory that plunged 67 percent in the past year.
Copper futures for July delivery rose 3.85 cents, or 2.5 percent, to $1.555 a pound at 8:18 a.m. on the Comex division of the New York Mercantile Exchange after reaching $1.565, the highest since January 1989.
Stockpiles monitored by the London Metal Exchange fell 950 metric tons to 42,275 tons today, extending a drop to the lowest since May 1988. The decline, combined with reduced inventory in the U.S. and China, the biggest copper users, helped push prices up 24 percent in the past year.
The ``extremely low level'' of inventory ``is the major price driver,'' said William O'Neill, a partner at Logic Advisors LLC in Upper Saddle River, New Jersey.
Copper prices have gained for 10 straight sessions. The metal has soared 7.2 percent this week, heading for the biggest weekly gain since July 1999. A futures contract is an obligation to buy or sell a commodity at a set price by a specific date.
To contact the reporter on this story:
Claudia Carpenter in New York at ccarpenter2@bloomberg.net.