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Copper and Aluminum Prices To Drop On Taper, Weaker Chinese Demand

By  +Follow August 19, 2013 7:30AM
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Copper futures due for delivery in December dropped 1 percent to $3.33 per-pound to begin the week of trading on Monday, on concerns about weakening demand for the metal through the remainder of 2013.

With a growing certainty across markets that the Federal Reserve will begin its gradual reduction of stimulus spending from $85 billion to $65 billion per month starting in September, analysts have worried that the resulting increase in the strentth of the dollar will send commodity prices downwards. Edward Meir, an analyst at New York’s INTL FCStone was quoted in a report as saying that a September taper would “likely result in a stronger dollar and a rollback in many commodity prices, including base metals.”

Futures have fallen nearly 8 percent so far in 2013, though prices have been on an upward trajectory for first half of August, due to better than expected economic data coming out of China. The country is the world’s largest consumer of copper, and trade figures released on Aug. 8 sent copper prices and related ETFs surging as expectations for a slow-down in construction were shown to be overstated.

The world’s largest mining companies, Rio Tinto Plc. (RIO) and BHP Billiton (BHP) posted significant increases in copper production for the second quarter. This production increase has led to more or less of a consensus that 2013 will see a stockpile surplus that will send prices lower either way. Furthermore, analysts have still been skeptical about the sustainability of the Chinese growth that has propelled copper.

Other base metals were feeling the pressure on Monday as well, with aluminum down 1.3 percent to $1,919.25 per ton on the London Metal Exchange, followed by zinc, nickel, and tin. United Rusal Co., the world’s largest producer of aluminum, said that announced reductions to its aluminum production targets in the wake of second-quarter losses.

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for BHP
luckypete
18 Dec 14 23:40:40
$DAX closed at 9811, Pre-mkt at 9877, futures at 9904, $BHP Billiton in AUS p0rojected $DAX +2% at 10,001 1st TARGET
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18 Dec 14 21:53:02
$BHP $TCK $CCJ: U.S. Silica Holdings: A Real Bargain In The Industrial Minerals And ... http://t.co/WqFJNNhdAf http://t.co/uihbqD77z5
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U.S. Silica Holdings: A Real Bargain In The Industrial Minerals And Mining Industry http://t.co/I0cVf5CdkB $BHP $SLCA
luckypete
18 Dec 14 20:40:05
AUS Giant Miner exporter ADR $BHP continues up, 28.75 2.50%, projecting a BIG UP day for $DAX in Frankfurt, Ger, 2% or 196 ---> 10,001<
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18 Dec 14 20:19:58
Resources Report - Gold moves amid global volatility $BCI $NCM $RIO $MGX $BHP: http://t.co/xbYmEhWGf9
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BHP +0.86% Stock Charts $BHP BHP Billiton Ltd. ADS (NYSE) Last Updated: 12/18/2014 20:29:27 BHP Stock Chart - http://t.co/fEVfohGIkb
luckypete
18 Dec 14 18:04:52
ASX AUS Giant Miner ADR $BHP opened 28.72 2.43%, FIG projects a POS open for Ger xetra $DAX, 1st TARGET for ^GDAXI 1.93% or 10,012<<
Dave
18 Dec 14 16:07:15
RT @StockSignaling: After Hours Price Advances: $MLNX $NRZ $BHP $ODP $INO $SU $ALLY $EXK $WOR $PETX $MHFI $JOY $CCL $ELP $AMZN http://t.co/…
Stock Signaling
18 Dec 14 16:01:08
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18 Dec 14 13:13:13
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18 Dec 14 11:06:45
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18 Dec 14 09:55:01
$BHP received a new alert. Find out why at http://t.co/5lwmDm2SCs #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 324
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18 Dec 14 09:15:22
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18 Dec 14 08:31:34
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18 Dec 14 07:35:32
RT @FinancialReview: $BHP will cut about $2b capex says Deutsche - the bank expects oil below $US80 until 2018 http://t.co/A0dibm35T3 #ausb…
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18 Dec 14 04:41:05
Platinum Memberships Rose, After 528% Gains On Penny Stocks, In One Month! Big Update: http://t.co/2W3yKD2d5Q $BHP $CADX $BSX
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18 Dec 14 03:33:08
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18 Dec 14 01:30:04
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ProVesting
17 Dec 14 23:11:04
$XOM $BHP: Oil Slump Threatens Future Australian LNG Projects http://t.co/TGqG4Sh2uH http://t.co/0KyZeDaNHX
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17 Dec 14 19:04:58
RT @SHMining: BHP Billiton shifting focus to copper from iron ore http://t.co/0yCyG05DEe $BHP #mining #copper #business
luckypete
17 Dec 14 18:31:31
ASX AUS Giant Miner ADR $BHP opened 28.12 + 2.22%, FIG projects a POS open for Ger xetra $DAX, 1st TARGET for ^GDAXI + 1.71% or 9715.
dre
17 Dec 14 16:45:51
RT @CommSec: ASX 200 +68pts/1.3% at 5230 in early trade;Materials sector leads $BHP +3.3% $RIO +3% $FMG +4.4%;Property lags $GMG -0.2% #aus…
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17 Dec 14 15:24:02
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17 Dec 14 15:05:34
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17 Dec 14 14:37:31
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17 Dec 14 13:49:21
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17 Dec 14 13:33:33
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17 Dec 14 13:30:05
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17 Dec 14 13:17:44
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Mark Conway
17 Dec 14 13:11:46
RT @FinancialReview: $BHP will cut about $2b capex says Deutsche - the bank expects oil below $US80 until 2018 http://t.co/A0dibm35T3 #ausb…
Paavfc
17 Dec 14 13:11:26
RT @FinancialReview: $BHP will cut about $2b capex says Deutsche - the bank expects oil below $US80 until 2018 http://t.co/A0dibm35T3 #ausb…
Financial Review
17 Dec 14 13:10:54
$BHP will cut about $2b capex says Deutsche - the bank expects oil below $US80 until 2018 http://t.co/A0dibm35T3 #ausbiz
Mark Trader
17 Dec 14 12:58:07
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17 Dec 14 12:31:47
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17 Dec 14 08:57:32
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Energize Minnesota
17 Dec 14 08:23:04
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Chart Street
17 Dec 14 07:41:17
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Stockaholics
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HGS Ltd.
17 Dec 14 06:45:21
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By  +Follow August 19, 2013 7:30AM
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