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Metalworking (rec.crafts.metalworking) Discuss various aspects of working with metal, such as machining, welding, metal joining, screwing, casting, hardening/tempering, blacksmithing/forging, spinning and hammer work, sheet metal work. |
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Sleigh bells ring for price of copper
Sleigh bells ring for price of copper as mystery trader fills Christmas
stocking Buyer acquires up to 90% of copper on London Metal Exchange as demand from China and others sends value to record high Jill Treanor guardian.co.uk, Wednesday 22 December 2010 19.43 GMT A mystery trader has accumulated up to 90% of the copper on the London Metal Exchange (LME) amid a dramatic rise in the price of the metal, driven by demand from China and other emerging economies. Copper prices have stormed to record levels this week and today closed at $9,403 (£6,063) a tonne as speculation swirled about the identity of the trading house sitting on the large position at the LME which has been steadily rising since the middle of November. The position is worth around $3bn and could include existing holdings as well as derivatives to buy the metal in the future. Other commodity prices also rose today. Oil pushed through the $90 a barrel level for only the third time in two years, after the banking crisis raised fears of a slow down in the world economy and a cut in demand for oil and other commodities. Data in the US fuelled the surge after showing that crude oil supply fell more than expected last week. Precious metals have also hit fresh highs recently. Silver has reached its highest levels 30 years while palladium has traded at prices last seen in 2001. The creation of such a dominant position in copper has mesmerised traders and helped fuel anxiety about the supply of copper, which is in turn driving the price higher. As it is, mines are finding it difficult to keep up with the demand for a metal that, according to analysts at Barclays Capital, is at its highest ever levels. Copper is used for wires and cables and is enjoying high levels of demand as emerging economics install more electricity and telecommunications, but also because renewable energy sources require the use of copper. But trading today was also driven by new worries about supply caused by shipping problems at the world's largest copper mine in Chile - Collahuasi. The LME first began to report that a so-called dominant position in copper had been accumulated on 17 November, but in recent days the size of this position has increased from "50% to 80%" to "80% to 90%". While US investment bank JP Morgan has been linked to the position, market sources insisted that this was not the case. A festive-themed note from analysts at Barclays Capital predicted that rising demand for commodities could keep prices buoyant next year. "Europe might be facing Arctic-type temperatures, but the base metals markets are heating up. Copper is the metal that appears to be everyone's favourite stocking filler, with prices rising to a new record high, punching well above $9,000 per tonne. The sleigh bells are ringing for the other metals too, driven by improving demand, the ongoing economic recovery and tightening market balances," Barclays Capital said. "[The year] has witnessed a number of surprises, but the real Christmas cracker has been the strength of the recovery in demand, which will be a record high for all the base metals except tin. Emerging market demand has been the single biggest swing factor, coming in well above market forecasts." China consumes 35% to 40% of the world's annual copper output, although there is some expectation in the markets that the metal could be swapped for aluminium in some products, which would help to ease pressure on demand. The demand for commodities is also being driven by the creation of so-called exchange traded funds, which allow investors to bet on the price of metals such as copper. The LME said it was not unknown for one trader to hold large positions. Diarmuid O'Hegarty, head of regulation and compliance, said: "Dominant long positions are not unusual and the LME has proven processes for dealing with these positions." To stop buyers cornering the market and manipulating the price, the rule is that once a trader has more than 50% they are obliged to lend the metal back to the market, if the demand arises, at predetermined prices set by the LME. "As a market of last resort, we do not stop people from buying metal; we restrict their behaviour depending on how much they buy. In times of short supply the LME stocks are often used as a source of material and in times of excess supply LME warehouses are used to store the metal," O'Hegarty said. http://www.guardian.co.uk/business/2...s-demand-china |
#2
Posted to rec.crafts.metalworking
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Sleigh bells ring for price of copper
?
"Chomp Noamsky" wrote in message ... Sleigh bells ring for price of copper as mystery trader fills Christmas stocking Buyer acquires up to 90% of copper on London Metal Exchange as demand from China and others sends value to record high Jill Treanor guardian.co.uk, Wednesday 22 December 2010 19.43 GMT A mystery trader has accumulated up to 90% of the copper on the London Metal Exchange (LME) amid a dramatic rise in the price of the metal, driven by demand from China and other emerging economies. Copper prices have stormed to record levels this week and today closed at $9,403 (£6,063) a tonne as speculation swirled about the identity of the trading house sitting on the large position at the LME which has been steadily rising since the middle of November. The position is worth around $3bn and could include existing holdings as well as derivatives to buy the metal in the future. Other commodity prices also rose today. Oil pushed through the $90 a barrel level for only the third time in two years, after the banking crisis raised fears of a slow down in the world economy and a cut in demand for oil and other commodities. Data in the US fuelled the surge after showing that crude oil supply fell more than expected last week. Precious metals have also hit fresh highs recently. Silver has reached its highest levels 30 years while palladium has traded at prices last seen in 2001. The creation of such a dominant position in copper has mesmerised traders and helped fuel anxiety about the supply of copper, which is in turn driving the price higher. As it is, mines are finding it difficult to keep up with the demand for a metal that, according to analysts at Barclays Capital, is at its highest ever levels. Copper is used for wires and cables and is enjoying high levels of demand as emerging economics install more electricity and telecommunications, but also because renewable energy sources require the use of copper. But trading today was also driven by new worries about supply caused by shipping problems at the world's largest copper mine in Chile - Collahuasi. The LME first began to report that a so-called dominant position in copper had been accumulated on 17 November, but in recent days the size of this position has increased from "50% to 80%" to "80% to 90%". While US investment bank JP Morgan has been linked to the position, market sources insisted that this was not the case. A festive-themed note from analysts at Barclays Capital predicted that rising demand for commodities could keep prices buoyant next year. "Europe might be facing Arctic-type temperatures, but the base metals markets are heating up. Copper is the metal that appears to be everyone's favourite stocking filler, with prices rising to a new record high, punching well above $9,000 per tonne. The sleigh bells are ringing for the other metals too, driven by improving demand, the ongoing economic recovery and tightening market balances," Barclays Capital said. "[The year] has witnessed a number of surprises, but the real Christmas cracker has been the strength of the recovery in demand, which will be a record high for all the base metals except tin. Emerging market demand has been the single biggest swing factor, coming in well above market forecasts." China consumes 35% to 40% of the world's annual copper output, although there is some expectation in the markets that the metal could be swapped for aluminium in some products, which would help to ease pressure on demand. The demand for commodities is also being driven by the creation of so-called exchange traded funds, which allow investors to bet on the price of metals such as copper. The LME said it was not unknown for one trader to hold large positions. Diarmuid O'Hegarty, head of regulation and compliance, said: "Dominant long positions are not unusual and the LME has proven processes for dealing with these positions." To stop buyers cornering the market and manipulating the price, the rule is that once a trader has more than 50% they are obliged to lend the metal back to the market, if the demand arises, at predetermined prices set by the LME. "As a market of last resort, we do not stop people from buying metal; we restrict their behaviour depending on how much they buy. In times of short supply the LME stocks are often used as a source of material and in times of excess supply LME warehouses are used to store the metal," O'Hegarty said. http://www.guardian.co.uk/business/2...s-demand-china J.P. Morgan's recent single session purchase of over 50% of the London Metals Exchange's 350,000 tonne copper reserve is a case in point. By eliminating so much copper from the available supply, J.P. Morgan single-handedly established a new price record in copper. Read mo http://www.benzinga.com/10/12/689006...#ixzz18ublhevT Its a trap for the suckers, kinda like mortage backed securities. Might be the next bubble - bailout in progress. Best Regards Tom. |
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