Copper futures edged down half a percentage point in early trading Thursday, however, trading volumes were thin as traders adapted a wait-and-see approach ahead of anticipated statements by Federal Reserve chairman Ben Bernanke and President Barack Obama for further insight into the state of the US economy.
After rallying aggressively in 2010- analysts and investment firms had very bullish projections for copper’s price outlook for 2011; with forecasts ranging between $11,000 per tonne to 13,000 per tonne.
Copper halted a two-day rally on Thursday as a fall in China’s export orders and concerns over the health of the global economy weighed down demand prospects.
As 2011 kicked off, copper prices seemed unstoppable with the red metal continuing its upward trajectory from 2010
The copper market has continuously been plagued with labour disputes for years, however, this year strikes have been especially prevalent with workers believing that they are entitled to larger pay cheques and benefits as they perceive that their employers are “raking in the cash” on the back of high metals prices.
Scrap copper is an important source of the red metal. The use of scrap copper is expected to rise in the coming years, as a necessary means to compensate for declining supplies of mined copper.
To obtain pure copper, mined rock must go through several processing stages before it is considered market ready.
While most traders and investment banking firms have repeatedly shrugged off weaknesses in the copper market as purely sentiment, without fundamental support, Societe Generale has bucked the trend and as in now saying that they are not very optimistic about near-term copper prices.
Copper’s push towards record-highs was stymied Wednesday, as traders took a strengthening greenback as a signal that it was time to take profits.
Copper futures retreated Thursday, snapping Wednesday’s rally to a three-month high, as negative sentiment over China’s economic future outweighed better-than-expected US manufacturing data.
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