More News Predicting 2011 Supply Crunch on CopperFyi…yet another FP article predicting major supply crunch for copper!
“Copper looks to shine
Kim InglisDecember 9, 2010 – 11:32 am
Copper has been on a roll this year and it doesn’t appear the trend will slow anytime soon.
Inventories have dropped because of significant supply shortages. According to a recent Bloomberg article, global exchanges dropped 22% in 2010. Freeport Chairman James Moffett attributes the decline partly to mine life. “The major copper reserves that are being produced today come from 100 year-old mines, with few exceptions,” said Moffett. Freeport-McMoRan recently stated they expect its copper sales from this year will drop to 1.1 billion pounds from 1.2 billion pounds in 2009.
As new reserves become more difficult to find, supply is expected to get even more constrained. As a result, analysts are calling for the biggest supply slide since 2004 and expect that demand will outpace supply by 367,500 metric tons in 2011.
Many large firms have made copper their top pick, including Goldman Sachs Group Inc. and Morgan Stanley. Canaccord Genuity analysts favor copper on a relative basis to other base metals and believe the global copper market will be in deficit for several years starting in 2011.”