Stamping Out a Living

This can't be good for copper prices.

from Yahoo Malaysia
A strike by Chilean mining subcontractors in its fourth day and denting output will keep state-run copper powerhouse Codelco's Andina and Salvador divisions closed through the weekend, the firm said on Saturday.

Labels: Copper

Last week, Bloomberg.com reported:

Mexico's copper output plunged 49 percent in January from a year earlier because of a strike at Grupo Mexico SAB's Cananea mine, the nation's largest producer.

This past Monday, they reported
Striking miners and other workers scuffled with rocks and sticks at Mexico's largest copper mine, injuring nearly two dozen people, the mine's owners and local media said Sunday.
Grupo Mexico SAB issued a statement urging government authorities to intervene after Saturday's scuffle at the Cananea mine in the northwestern state of Sonora, where strikers tried to block other workers from entering the facility.

Copper is now at $3.90+ and still seems to be headed upwards.

Labels: Copper

This would go some distance towards explaining why copper inventories are so tight and prices so high. Hopefully the new mine in 2008 will bring some stability to the copper market.

Bloomberg.com
Chile's state-owned Codelco, the world's largest copper producer, said output fell 6.6 percent last year, the third straight annual drop, because of aging mines and labor protests.
Production dropped to 1.67 million metric tons from 1.78 million tons in 2006, Santiago-based Codelco said in a statement. A strike in June and July curbed output, and the amount of copper in the rock at mines declined.
Global stockpiles of the metal have tumbled this year, and copper prices have climbed 27 percent. Production will rise in 2008 with the opening of a new mine, Codelco Executive President Jose Pablo Arellano said at a news conference.

Labels: Copper

Copper may fall next week on speculation the U.S. economy is sliding into recession, reducing demand for the metal used in wires and pipes.
Maybe, but so far, it's still hanging out in the $3 neighbourhood, a far cry from $2.50 a year ago and $0.80 5 years ago.

Labels: Copper

For an amusing hour or so yesterday, Kitco, my favorite metals reporting web site, was claiming that Copper had dropped a dollar to $2 and change. It must have been a reporting glitch, because later the metal went back up to $3 and change. But for a few minutes there I was ready to break out the champagne.

But copper at $3 is a lot better than a year ago, when it was up to $4.

Likewise, zinc is still above "normal" levels, but has subsided recently to a buck (it had been $2 just over a year ago).

Nickel, having been close to $25 a year ago, is down around half that now. For a while, in late 2007, it was actually down under 12

Labels: brass, Copper, nickel, zinc

NASDAQ
Since copper is often used in construction, the red metal usually moves with economic news. Traders still considered the Federal Reserve's announcement of a series of measures aimed at addressing the problems in the short-term funding markets, which could boost fuel demand. The moves were made in conjunction with many of the world's other major central banks. The announcement came a day after the Fed announced a quarter-point reduction in its benchmark interest rate, a move that was widely criticized for not giving enough help to the markets.
With concerns over the U.S. economy, copper supplies are at a nine-month high. Data showed inventories monitored by the London Metal Exchange were at 3,675 metric tons, up 193,000 tons, its highest level since the middle of March.

For all that copper goes up slightly and down slightly, it's still awfully expensive in terms of long term trends. Copper is back to where it was a year ago, but still more than 3 times the price it was 5 years ago (about 80 cents US).

Labels: Copper

Once again, no one is dealing with the problem that small and medium manufacturers have, that is, if you tarif the raw materials but not the finished goods, they get around the tarifs by supplying the finished product, a flashlight, whatever, at below our costs for the raw materials.

International Herald Tribune
The EU began an inquiry into whether Chinese exporters, including Baoshan Iron & Steel and Wuhan Iron & Steel, sell flat-rolled steel in the EU below cost, a practice known as dumping. The inquiry covers €1.2 billion, or $1.7 billion, of imports of hot-dipped metallic-coated steel.

The investigation will determine whether the steel "is being dumped and whether this dumping has caused injury," the European Commission, the executive arm of the EU, said in the Official Journal.

The commission has nine months to decide whether to impose provisional anti-dumping duties for half a year and EU governments have 15 months to decide whether to apply "definitive" levies for five years.

Here's another, similar article, from the Toronto Star, a local (to Toronto) newspaper.

EU officials have warned of a protectionist backlash if China doesn't do more to open up to European exports. They've also asked that Beijing address the valuation of the yuan, which they say gives Chinese exporters an unfair price advantage.

Labels: Copper, currency, manipulation, steel

Nasdaq news

Copper continued its recent slide on Friday in U.S. trading. December-stamped copper contracts were at $3,325, down 3.75 cents on the session. The red metal dropped more than 20 cents on the week.

The metal moved lower throughout the week as economic concerns in the U.S. continued. Since the metal is often used by builders in construction, economic growth or lack thereof often moves the copper market. Investors continued to mull the US Federal Reserve's decision to lower its interest rates by 25 basis points to 4.5% on Wednesday.

Labels: Copper

Bloomberg.com
Copper prices fell in Shanghai as global stockpiles kept rising, renewing concern that demand is slowing for the metal used in wires and pipes.

Labels: china, Copper

Bloomberg.com: Latin America
Copper headed for a fourth weekly advance in London as a strike by Peruvian workers cut production and on speculation a report will indicate economic growth in the U.S., the second-largest user of the metal. Lead gained to a record. A three-day strike by workers at a smelter and two mines owned by Southern Copper Corp. in Peru reduced output by 10 percent, Chief Executive Officer Oscar Gonzalez Rocha said yesterday.

The Motley Fool had this humorous comment. The effect for metal stampers, if they're correct, is more price increases in copper.

So here's the latest metal muddle. Workers at three of Southern Copper's (NYSE: PCU) Mexican mines have been on strike since the end of July. Wednesday, their Peruvian brethren struck for the third time this year. This isn't a knock on Southern Copper specifically. Dozens of Peruvian mining unions have agreed to a national strike beginning Nov. 5. Thus, these miner grievances are anything but minor.

Production outages, of course, support the price of copper as stockpiles fall. So it's a great time to own a copper producer, so long as its operations aren't being disrupted.

Labels: Copper

bloomberg.com

Copper may fall next week on speculation that demand will slow in China, the largest buyer of the metal, following a surge in imports in the first quarter.

Yahoo Asia:
copper rebounded on Friday, but analysts think the overall trend of rising copper stocks and lower demand over coming months could pressure prices down further.

Copper futures shed 2.3%
China Daily
Copper futures in Shanghai fell by [...] nearly 4 percent, by midday on Friday before closing [...] down 2.3 percent from the previous close, because of growing investors' concern about rising stocks of the industrial metal in China.

Labels: china, Copper

Bloomberg.com

Copper headed for its largest weekly decline in three months in London on speculation that demand growth will slow in China, the world's biggest user. Nickel and zinc rose.

China's copper imports probably slowed in April, said analysts including Kevin Norrish at Barclays Capital.

``The Chinese market is suffering temporary indigestion after the amount of material delivered into Shanghai in the first quarter,'' Norrish said today by phone from London. ``Some people expected them to buy this week when they returned to the market after the holiday, but that hasn't happened.''

Labels: china, Copper

Here's a brief update on material pricing.

Zinc has now fallen from the $2 US/lb that it was late last year to about $1.50 US now. However, many platers buy zinc on contract, and so until their contracts run out, higher prices will prevail. By comparison, zinc was $0.50 in June of '05

Copper is again on the rise. It got down as far as $2.50 in February, but is up around $3.30 now. A year ago it was $4.00, so it's a bit off the peak, but not enough to feel comfortable.

Nickel is climbing and shows no sign of stopping. It's currently about $22.75, up from $16 at the year boundary, from $8 a year ago, and $3 five years ago.

Zinc is used in almost every method of rust-proofing steel (except stainless steel). Nickel is used in stainless steel. Brass is a combination of zinc and copper.

Labels: brass, Copper, nickel, steel, zinc

Bloomberg News
Copper prices rose in New York, extending a six-week rally that is the longest since May, on speculation that supplies will be disrupted at mines in Indonesia and Argentina.

Workers at the Grasberg mine in Indonesia plan a ``rally'' starting April 18 that will last until owner Freeport-McMoRan Copper & Gold Inc. agrees to raise wages, said Frans Pigome, who heads the local group behind the action. In Argentina, Xstrata Plc delayed some copper shipments after a flood disrupted rail services. Prices have risen 47 percent in the past 10 weeks.

The disruption of supply ``only adds fuel to the bullish fire,'' said Jim Wyckoff, senior markets analyst at TradingEducation.com in Wesley Chapel, Florida. ``The market is technically and fundamentally bullish.''

Labels: Copper

WTRF-TV
WEIRTON -- More than 1,100 Independent Steel Union Members have joined the ranks of The United Steelworkers.
The ISU formed in 1951 and now, 56 years later, after increased competition from foreign steel companies on the U.S. steel industry, the once massive union was forced to dissolve.

Labels: Copper, steel

Copper has bounced and is back on the rise. From a low of $2.40 a few weeks ago, it's gone back up to $3. It's still a whole lot better than the $4 it hit a while back, but not nearly low enough or stable enough for metal stampers to specify it reliably.

Other metals:
Zinc, having hit $2, is down to $1.45, but there was a short run up a few weeks ago.
Nickel, which was $3 5 years ago, is now $22, more than 5 times the price of 5 years ago and shows no sign of slowing down.

You can see the historical charts yourself here: Copper, Zinc & Nickel
all courtesy of Kitco Metals.

Labels: brass, Copper, nickel, zinc

Gulf Times
Philippine copper output is expected to rise 85% this year and gold output by 16% due to the opening of new mines funded by foreigners, Environment Secretary Angelo Reyes said yesterday.
“Our projections show that, indeed, the Philippine mining industry is facing a major take-off in the next two to three years as five of the world’s largest mining players are now in the country doing exploration and mining development,” Reyes told Reuters in an e-mail, in response to questions.

Labels: Copper

In essence, the "Big Chunk" they own is a large area in Alaska containing an ancient volcanic structure known as a caldera. They think this area will be found to be rich in gold and copper deposits. No information here on cost of extraction or climate effects.

Labels: Copper, Gold