Red metal ends near its session high

Tighter supply outlook, labor related problems and weak dollar push up prices

Copper prices ended higher on Thursday, 15 March 2012 at Comex. Copper ended up near its session highs on Thursday, bolstered by an increasingly tighter supply outlook after warehouse stocks fell further and labor-related problems forced one of the world's top miners to lower its first-quarter sales outlook. Prices also ended higher due to a weak dollar.

Copper for May delivery ended higher by 5 cents (1.4%) at $3.9 a pound at Comex on Thursday. Last week, prices shed about 1%. For February 2012, copper had gained 2.2%.




Red metal prices for three-month-delivery at LME rose $105 (1.24%) to $8,565 a metric ton on Thursday.

Copper climbed over 1% after Freeport-McMoRan Copper & Gold said it had revised down its consolidated first-quarter sales volumes by about 10% due to labor-related problems at its giant Grasberg mine in Indonesia.

Among economic data expected for the day, The Labor Department reported first-time claims for jobless benefits fell by 14,000 to 351,000 last week, returning to a four-year low. The New York Federal Reserve's gauge of manufacturing in the region in March climbed to 20.2 from 19.5 the month before, reaching a 21-month high in the most recent reading. In a separate report, the Federal Reserve Bank of Philadelphia's business-condition index rose to 12.5 in March from 10.2 last month.

In the currency market on Thursday, the Dollar Index, which weighs the strength of dollar against basket of six other currencies fell by almost 0.45%.

As per latest reports, LME copper stocks fell by 2,875 tonnes to 267,750 tonnes, the lowest level since July 2009.

For the year 2011, copper shed 23% following a 30% increase in 2010 and a 140% jump in 2009, boosted by surging demand from China's manufacturers. China accounts for 40% of the world's refined copper consumption.

Among other traded metals at LME on Thursday, lead in London rose 0.9% at $2,121 a ton and nickel closed lower by 1% at $19,380 a ton. Aluminum closed higher by 0.9% at $2,249 a ton, and zinc closed higher by 0.9% at $2,092 a ton.

At the MCX, copper prices for April delivery ended higher by Rs 5.6 (1.3%) at Rs 434.6/Kg. Prices rose to a high of Rs 435/Kg and fell to a low of Rs 426.6/Kg.