Copper hits a record andSTARFIELD RESOURCES INCORPORATED HAS COPPER/NICKEL/COBALT/PLATINUM/
PALLADIUM/RHODIUM. Read the copper report below please. J.F.
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ANNA STABLUM
Thursday, March 06, 2008
LONDON — Copper prices hit a record high on fresh fund buying on Thursday with traders eyeing $10,000 (U.S.) a tonne with inventories falling in an already tight market.
Other key base metals also advanced, with nickel rising more than 5 per cent and aluminum prices pushed higher.
“The copper market remains beholden to falling LME inventory and ongoing fears of supply disruptions,” analyst Daniel Hynes at Merrill Lynch told Reuters.
“It also reflects the bigger issue of surging investment into the commodity markets as investors seek refuge from weak equity and bond markets, rising inflation and a weak U.S. dollar.”
Copper for delivery in three months on the LME hit a record high of $8,820 a tonne and was at $8,770/8,795 by 1028 GMT, against $8,690 on Wednesday.
“A lot of people are saying copper could go to $10,000,” an LME trader said.
Copper stocks in LME-registered warehouses fell by 2,350 tonnes to 135,800, down by about a third since the start of the year and enough for less than three days of world consumption.
“In reality there is not much spare metal around,” head of resources John Meyer at Fairfax said in a report.
“Copper prices are being pushed by investment demand but this is supported by ongoing demand growth for infrastructure development,” he said.
Nickel futures for three months delivery rose as high as $35,150 and were last at $34,200/34,400 against $33,400.
Three-months aluminum was at $3,240/3,245 versus $3,208 on Wednesday.
Prices were supported by the surge in U.S. crude trading close to record high levels at around $105 per barrel.
“Structural tightness in global energy markets and subsequent shifts higher in costs are already constraining metals supply, especially for energy-addicted aluminum,” a Barclays Capital report said.
Aluminum's precarious supply outlook combined with the strongest long-run demand prospects of all the base metals is a recipe for a tighter market and higher prices, it said.
Barclays Capital raised its aluminum annual price forecast for 2008 and 2009 to $3,513 per tonne and $4,500, respectively.
“At the moment you have to go with momentum - you have to be a brave man to be short in these markets,” the LME trader said.
Leading European shares were down with the FTSEurofirst 300 falling 0.71 per cent to 1291.88 points by 1033 GMT.
The dollar hit lifetime lows versus the euro on weak U.S. economic and worries about a recession, which has galvanized the U.S. Federal Reserve to cut borrowing costs sharply to 3 per cent, with further easing expected.
“The market is looking at rising inflation,” said Ashok Shah chief investment officer at fund manager London & Capital.
“Falling interest rates will encourage global growth rates to accelerate later but for now everyone is looking to inflation hedges ... across the board to all commodities,” he said.
A cheaper U.S. currency makes dollar-priced metals less expensive for holders of other currencies supporting prices.
The slump in the dollar drove spot gold to a record high of $991.90 on Wednesday.
In industry news, Kazakhmys Plc, the world's 10th biggest copper producer, posted a 0.7 per cent rise annual earnings per share on Thursday, lower than forecasts after flooding and processing problems cut output.
Tin hovered close to its all-time high of $19,375. It hit an intra-day high of $19,350 before trading at $19,200/19,350 versus $19,250. Zinc was at $2,898/2,908 against $2,815 and lead gained to $3,400/3,420 from $3,350.
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