Alta Copper Corp. T.DNT

Copper a long term buy

[spazzman]

Buy copper once it hits US$6,200 a tonne: UBS
John ShmuelAugust 25, 2010 – 3:37 pm
Copper is becoming a hard metal to predict these days. Although consensus is it’s most likely going to lose value in the coming months as demand cools off, the longer term outlook is a little hazy.
A new report from UBS recommends investors patiently wait for spot prices to drop, and if they do, to buy up long positions in the bellwether metal. In UBS’s view, the price bottom is likely to be around US$6,200 a metric tonne, meaning that will be the best time to buy.
Spot prices are currently hovering around US$7,200. UBS expects economic newsflow to continue to skew to the negative side, pushing prices lower. But the longer outlook for the metal, barring a double-dip, means once it hits US$6,200 a tonne, there will be a big premium on the metal.

That’s because the macro trends will actually conspire to keep copper demand healthy in the coming years. Year-to-date global copper production is lower than it was in 2009, a stark contrast to other base metals such as lead, zinc and aluminum, which saw production increases.
Meanwhile, Chinese imports of copper, although slowing, are expected to hold up. UBS expects that will lead to a copper deficit in 2011, compared to a predicted minimal surplus in 2010.
That means if copper does hit US$6,200 a tonne in the near-term, taking a long position will be a good option. UBS forecasts avergae prices in 2011 to be US$7,200 a tonne.
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Posted in:Mining, Trading DeskTags:Commodities, Prices, Copper, UBS
Read more: https://business.financialpost.com/2010/08/25/buy-copper-once-it-hits-us6200-a-tonne-ubs/#ixzz0xvzreuIk