Copper
stocks were once again in limelight as prices declined after three days
of relief rally. The talks that US will stop the quantitative easing
measures earlier tumbled Copper and peers. Amid all this, Copper
inventories continued to swell and has ballooned to 590175 tonnes, up
2250 tonnes.
The fall in QE programme can bring down the prices
of metals that has been riding on account of investment demand. The
reports that Chile 24 hour strike ended eased the metal further down on
Thursday. Codelco is the biggest Copper producer in the world. LME
Copper was trading at $ 7545 per tonne, down $ 30 per tonne.
It
should be made clear that manufacturing growth in world major consumers
has been slowing down and recovery will take time. Therefore the rise in
metals has been majorly due to speculative and investment led demand.
Metals like Aluminium, Copper and Zinc have been supported by the
financial deals.
But situation has changed in 2013, ample of
supplies in spot markets is clubbed by falling demand while rising
stockpiles is now a worry. Till December 2012 news was that the fall in
spot supplies was pressurizing the prices. Copper has seen the rise of
85 percent in inventories this year. Similar is the case of Aluminium
where inventories have crossed 5.2 million till early April.
Meanwhile,
China reported its trade data for the month of March 2013 yesterday.
The data from General Administration of Customs showed that the imports
of unwrought Aluminium and Aluminium products was 69845 tonnes in March
2013, down 42 percent from 120494 tonnes from March 2012.
Indian
Copper futures for April expiry declined by 0.5 percent, and were seen
at Rs 409.8 per kg. The prices tested low of Rs 409 per kg. The prices
are supported at Rs 408 per kg and have resistance at Rs 413.5 per kg.
Markets
will be eyeing for the initial jobless claims data from the US, due to
be released on Thursday. Increase in jobless claims will make market
players believe that the stimulus measures will continue.
Source by Commodity Insights
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