Farallon Resources Ltd. (fka FRLIF)

[the cork]

Information for Farallon Mining Limited shareholders

On 15 November 2010, Nyrstar announced that it had entered into a binding support agreement with Farallon Mining Limited (TSX: FAN) pursuant to which Nyrstar has agreed to make an all-cash offer to acquire all of the issued and outstanding shares of Farallon by way of a friendly take-over offer at a price of C$0.80 per common share (the “Nyrstar Offer”), valuing Farallon’s equity at approximately C$ 409 million (€296 million) on a fully diluted basis.

Below is an overview of some commonly asked questions regarding the Nyrstar Offer.

Should Farallon Shareholders have additional questions please contact the Depository and Information Agent Kingsdale Shareholder Services Inc., at 1-866-581-0507 toll free in North America, or at 1-416-867-2272 outside of North America, or by e-mail at [e-mail].

1. What is the Nyrstar Offer?
Close
Nyrstar has entered into a binding support agreement with Farallon Mining Limited pursuant to which Nyrstar has agreed to make an all-cash offer to acquire all of the issued and outstanding shares of Farallon by way of a friendly take-over offer at a price of C$0.80 per common share, valuing Farallon’s equity at approximately C$409 million (€296 million) on a fully diluted basis.
2. Why should Farallon shareholders tender to the Nyrstar Offer?
Close
Farallon shareholders should consider the following factors in making their decision to tender their Shares to the Nyrstar Offer, as outlined in the press release announcing the Offer:

* All-cash offer of C$0.80 per common share values Farallon’s equity at approximately C$409 million, or €296 million on a fully diluted basis;
* Represents a premium of approximately 23% over Farallon’s closing share price of C$0.65 on the Toronto Stock Exchange (TSX) on November 12, 2010 and a premium of 32% to Farallon’s volume weighted average price of C$0.61 on the TSX for the 20 trading days prior to the announcement of the offer from Nyrstar;
* Farallon’s Board of Directors has unanimously recommended that shareholders tender their shares to the Nyrstar Offer after receiving a fairness opinion that the consideration to be received by Farallon shareholders is fair from a financial point of view;
* Each director and officer has entered into a lock-up agreement to tender in favour of the Nyrstar Offer (2.6%). Lock-up agreements have also been entered into with Acuity Investment Management (16.3%). In aggregate, holders of a total of 18.9% of Farallon common shares have agreed to tender in favour of the Nyrstar Offer;
* The Nyrstar Offer is fully financed.


3. Who is Nyrstar?
Close
Nyrstar is a leading global multi-metals business listed on NYSE Euronext Brussels under the symbol NYR. For further information visit the Nyrstar website, www.nyrstar.com.
4. Nyrstar has also announced a EUR500 million rights offering, is that a condition of the Farallon bid?
Close
No. The successful completion of the rights offering is not required in order to finance the Nyrstar Offer. The Nyrstar Offer will be financed from existing financial means and credit facilities that Nyrstar has in place.
5. Have other Farallon shareholders committed to tendering their Common Shares?
Close
Yes. Each director and officer of Farallon has entered into a lock-up agreement to tender in favour of the Nyrstar Offer (2.6%). Lock-up agreements have also been entered into with Acuity Investment Management (16.3%). In aggregate, holders of a total of 18.9% of Farallon common shares have agreed to tender in favour of the Nyrstar Offer.
6. How will Farallon shareholders be compensated for tendering their Common Shares?
Close
Shareholders have received an all-cash offer of C$0.80 per Common Share. This values Farallon’s equity at approximately C$409 million, or €296 million on fully diluted basis. All payments under the Nyrstar Offer will be made in Canadian dollars.
7. When will the Take-Over Bid Circular and Director’s Circular be available?
Close
The Take-Over Bid Circular and Director's Circular were mailed and filed on SEDAR on 24 November 2010, with the take up of shares to expire at 5.00pm (Toronto time) on 5 January 2011.
8. Who do I contact for more information?
Close
Questions and requests for assistance may be directed to the Depository and Information Agent Kingsdale Shareholder Services Inc., at 1-866-581-0507 toll free in North America, or at 1-416-867-2272 outside of North America, or by e-mail at [e-mail].

IMPORTANT INFORMATION

This document has been prepared by Nyrstar NV (the "Company"). It does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the Company or any member of its group nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities of the Company or any member of its group, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever.

The information included herein has been provided to you solely for your information and background and is subject to updating, completion, revision and amendment and such information may change materially. Unless required by applicable law or regulation, no person is under any obligation to update or keep current the information contained in this announcement and any opinions expressed in relation thereto are subject to change without notice. No representation or warranty, express or implied, is made as to the fairness, accuracy, reasonableness or completeness of the information contained herein. Neither the Company nor any other person accepts any liability for any loss howsoever arising, directly or indirectly, from this announcement or its contents.

This document and any materials distributed in connection with this document are not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction.

The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about and observe any such restrictions. The Company’s shares have not been and will not be registered under the US Securities Act of 1933 (the “Securities Act”) and may not be offered or sold in the United States absent registration under the Securities Act or exemption from the registration requirement thereof.


http://www.nyrstar.com/nyrstar/en/investors/info_for_farallon_mining_en/

[the cork]

Well it's been a good run.

Hate to see it happen, but I guess for a quality operation like this it was inevitable, dammit. Farallon was my favorite mining stock.

Always thought they were undervalued considering the low cost output.

I wouldn't accept the offer it it was up to me, since I think they should be well over a dollar anyway, but it ain't up to me.

In at .24 and out at .80 isn't bad.

Good luck to all Farallon holders. I got some great places to put the money if anybody is interested.

GLTA !!

[the cork]

Nyrstar Takeover Bid

http://www.farallonresources.com/i/pdf/fan/NyrstarTakeoverBidCircular.pdf

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Farallon Announces CDN$0.80 per Share Offer by Nyrstar NV and Enters into Support Agreement

November 15, 2010, Vancouver, BC -- Farallon Mining Ltd. ("Farallon" or the "Company") (TSX:FAN) announces that it has entered into a Support Agreement with Nyrstar NV ("Nyrstar"), pursuant to which Nyrstar has agreed to make an all-cash offer to acquire 100% of the fully diluted common shares of Farallon by way of a friendly take-over bid for CDN$0.80 per common share in cash (the "Offer"). The Offer represents a 32% premium to the 20 day volume weighted average share price on the TSX of Farallon common shares, and a 23% premium to the closing market price on the TSX of Farallon common shares on Friday, November 12, 2010, the last day of trading before the Offer.

Farallon's Board of Directors, after consulting with its financial and legal advisors, and based on the recommendation of an independent special committee of the Board, has determined to unanimously recommend acceptance of the Offer to shareholders. Paradigm Capital Inc., the financial advisor to Farallon's Board of Directors provided an opinion that the consideration to be received by the holders of Farallon shares pursuant to the Offer is fair, from a financial point of view.

Dick Whittington, Farallon's President and Chief Executive Officer, commented: "We are pleased that Nyrstar has recognized the value of our G-9 Mine and agreed to make a take-over offer valuing the Company at over CDN$400 million. We believe this offer represents a meaningful and fair premium to the current share price. Accordingly, we are recommending shareholders tender their shares into the offer."

In connection with the Offer, the directors and officers of Farallon as well as Farallon's largest single shareholder, Acuity Investment Management Inc., have entered into lock-up agreements with Nyrstar pursuant to which they have agreed to tender their Farallon common shares to the Offer. The Support Agreement and the lock-up agreements may be terminated in the event of a superior proposal from a third party and certain other circumstances. The lock-up agreements represent approximately 19% of outstanding Farallon common shares (calculated on a fully-diluted basis).

Under the Support Agreement, Farallon has agreed to pay Nyrstar a termination or break fee of approximately CDN$12 million (3% of the Offer value) in certain customary circumstances including a Farallon Board recommendation of any superior proposal. Farallon has agreed to waive its shareholder rights plan for the Offer and has also provided Nyrstar with certain customary rights, including a right to match any superior proposal. The Offer is not subject to any due diligence condition.

A bid circular is expected to be mailed shortly by Nyrstar and will be accompanied by the Farallon directors' circular. The Offer will be open for acceptance for a period of not less than 35 days and will be conditional upon, among other things, valid acceptance of the Offer by Farallon shareholders totalling at least 662/3% of the outstanding Farallon common shares on a fully diluted basis. In addition, the Offer will be subject to certain customary conditions, relevant regulatory approvals and the absence of any material adverse effect with respect to Farallon. Nyrstar may waive certain conditions of the Offer in certain circumstances. If the Offer is successful, Nyrstar has agreed to take steps available to it under relevant securities and corporate laws to acquire any remaining outstanding Farallon common shares. A copy of the Support Agreement will be filed at www.sedar.com.

Advisors

Paradigm Capital Inc. is acting as financial advisors and Lang Michener LLP is acting as legal counsel to Farallon, with McCarthy Tétrault LLP acting as counsel to the special committee of Farallon's Board.

About Farallon

Farallon operates the G-9 zinc mine on its Campo Morado Property in Guerrero State, Mexico. G-9 is an underground zinc mine with important by-product credits of copper, gold, and silver. G-9 has total cash costs amongst the lowest of zinc producers worldwide. For further details, please visit the Company's website at www.farallonmining.com or contact Neil MacRae, Investor Relations Manager, at [phone] or within North America at 1-877-688-2050.

About Nyrstar

The partner of choice in essential resources for the development of a changing world. Nyrstar is a leading global multi-metals business, producing significant quantities of zinc and lead as well as other products (including silver, gold and copper). Nyrstar is listed on NYSE Euronext Brussels under the symbol NYR. For further information visit the Nyrstar website, www.nyrstar.com

Third Quarter Results and Conference Call

The Company will file its September 30, 2010 Financial Statements and MD&A on SEDAR later today. A news release detailing the results will be issued before markets open on Tuesday November 16, 2010 and Farallon will hold a conference call Tuesday November 16, at 6:00 am Pacific time (9:00 am Eastern) to discuss these results and the Offer. The call can be accessed at [phone] or toll-free at [phone]. A live webcast will also be available at www.farallonmining.com.

The webcast will also be available at http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=3240160.

ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington, President & CEO

No regulatory authority has approved or disapproved the information contained in this news release

Forward Looking Information
This news release includes certain statements that may be deemed "forward-looking statements." All statements in this release relating to a proposed take-over bid are of necessity forward looking. The outcome of a take-over bid can not be certain because the process is subject to a number of conditions described ion the Support Agreement referred to above. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual events or developments may differ materially from those in the forward looking statements and may require achievement of a number of regulatory and legal requirements. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com. No regulatory authority has approved or passed on the merits of this news release.



You can view the Next News Releases item: Mon Nov 15, 2010, Farallon Announces Third Quarter Financial And Operating Results

http://www.farallonresources.com/fan/NewsReleases.asp?ReportID=428398&_Type=&_Title=Farallon-Announces-CDN0.80-per-Share-Offer-by-Nyrstar-NV-and-Enters-into-Su...

[the cork]

Nyrstar announces binding agreement to pursue friendly offer to acquire Farallon Mining Limited

15 November 2010

Nyrstar NV ("Nyrstar") today announced that it has entered into a binding support agreement with Farallon Mining Limited (TSX: FAN) ("Farallon") pursuant to which Nyrstar has agreed to make an all-cash offer to acquire all of the issued and outstanding shares of Farallon by way of a friendly take-over offer at a price of C$0.80 per common share (the "Nyrstar Offer"), valuing Farallon's equity at approximately C$409 million (€296 million) on a fully diluted basis.

The Nyrstar Offer represents a premium of 23% to Farallon's closing share price of C$0.65 on the Toronto Stock Exchange (the "TSX") on 12 November 2010 and a premium of 32% to Farallon's volume weighted average price of C$0.61 on the TSX for the 20 trading days prior to the announcement of the Nyrstar Offer.

Farallon's Board of Directors has unanimously recommended that shareholders tender their shares in favour of the Nyrstar Offer. Paradigm Capital Inc has provided an opinion to the Farallon Board of Directors that the consideration to be received by Farallon shareholders under the Nyrstar Offer is fair, from a financial point of view, to the Farallon shareholders. Each director and officer has entered into a lock-up agreement to tender in favour of the Nyrstar Offer (2.6%). Lock-up agreements have also been entered into with Acuity Investment Management (16.3%). In aggregate, holders of approximately 18.9% of Farallon common shares have agreed to tender in favour of the Nyrstar Offer.

Farallon is the owner of the Campo Morado zinc-rich polymetallic mining operation in Mexico (the "Campo Morado Operation"). The Campo Morado Operation comprises approximately 12,000 hectares in six mining concessions, located 160 kilometres south-southwest of Mexico City. The ore deposit currently being mined is the G-9 deposit which achieved commercial production in April 2009 and comprises high grade zinc, copper, lead, gold and silver (the "G9 Mine"). In addition to the G9 Mine, there are four additional deposits that have been delineated (Reforma, El Largo, El Rey, Naranjo).

Nyrstar intends to ramp-up production to a rate of 2,500 tonnes per day of ore by the end of 2012, representing production of approximately 70,000 tonnes per annum of zinc in concentrate, 8,000 tonnes of copper in concentrate, 7,000 tonnes of lead in concentrate, 3 million troy ounces of silver and 35,000 troy ounces of gold. Once fully ramped-up, the G9 Mine is expected to have a first quartile C1 cash cost [1] of less than US$500 per tonne of payable zinc due to significant by-product credits.

Farallon discovered the G-9 deposit in 2005 and utilised a "parallel track" strategy to rapidly develop the mine by incurring advanced exploration expenses in parallel with pre-development expenditures, and forgoing a formal feasibility study. As a result the company was able to achieve commercial production by April 2009, less than four years after discovery although a comprehensive exploration program has not yet been undertaken around the G-9 deposit. The Company believes that current estimated total resources, if all deposits were included, would support a mine life of more than 10 years. However, Nyrstar believes that there is significant exploration potential at the G-9 and surrounding deposits as demonstrated by Farallon's recent announcement of a newly discovered zinc-rich polymetallic zone at the G9 deposit (see www.farallonmining.com for further details).

The acquisition is in line with Nyrstar's strategy to selectively pursue opportunities in mining and will further strengthen Nyrstar's operating cluster in the Americas. Commenting on the Offer, Nyrstar's Chief Executive Officer, Roland Junck said:

"Farallon comprises an outstanding set of assets at an early stage of their development that will complement Nyrstar's existing multi-metals business.

The acquisition is expected to increase our capacity for zinc metal production from our own concentrates by 6 per cent to approximately 31 per cent and, as the G9 Mine is expected to be in the lowest quartile of zinc producers on a global scale in terms of operating costs, is expected to reduce our group mining C1 cash costs to less than US$1,000 per tonne by 2012 once all operations are fully ramped up, helping to provide for the long term sustainability and profitability of our business.

Whilst the rapid development of the G9 Mine has meant that Farallon has not yet undertaken a comprehensive exploration program, we believe that there exists significant exploration potential.

We believe that our offer provides substantial value to Farallon shareholders and recognises Nyrstar's belief in the excellent potential of the Campo Morado Operation."

The Nyrstar Offer will be will be financed on the basis of existing financial means and credit facilities.

The Nyrstar Offer is conditional on a number of customary conditions including a minimum acceptance condition of 66 2/3%, receipt of all regulatory approvals and no material adverse change in Farallon's business, and other customary conditions. Under the support agreement Farallon has agreed to pay Nyrstar a "break" fee of approximately C$12 million (3% of the Nyrstar Offer value) in certain customary circumstances. Further, Nyrstar has agreed to pay Farallon a "break" fee of C$1.5 million although limited to circumstances in which Nyrstar terminates the support agreement as a result of a material adverse change in Farallon's financial condition or operations. Farallon has also provided Nyrstar with certain customary rights, including a right to match any superior proposal.

The Take-Over Bid Circular and Directors' Circular are expected to be mailed and filed shortly, with the initial take up of shares to be 35 calendar days from the date of mailing.


Reserves and Resources
The following are summaries of the most recent NI 43-101 compliant reserve and resource statement for the G9 Mine and resource statement for the other deposits sourced from the Farallon website (see: http://www.farallonmining.com/fan/MineralResources.asp).


G-9 Reserves and Resources*, 31 December 2009
Resource Class Tonnes (kt) Zn (%) Cu (%) Ag (g/t) Au (g/t)
Proven Reserves 525 10.36 1.28 274 3.69
Probable Reserves 1,425 9.87 1.37 187 2.77
Total Reserves 1,950 10.00 1.34 211 3.03
Measured Resource 1,418 8.65 1.23 239 3.64
Indicated Resource 1,606 10.04 1.39 185 2.72
Inferred Resource 930 9.17 1.14 187 2.50
Total Resource 3,954 9.34 1.27 205 3.00

* Mineral Resource inclusive of Mineral Reserve with a 3% zinc grade cut-off grade


Additional Deposit Resources**, 31 December 2009
Category Tonnes (kt) Zn (%) Cu (%) Ag (g/t) Au (g/t)
South West Zone Inferred 242 6.10 0.83 169 2.51
El Largo Indicated 2,860 6.69 0.34 124 0.79
Inferred 241 6.43 0.42 151 1.41
El Rey Indicated 323 5.88 0.53 162 2.98
Naranjo Indicated 577 6.00 0.66 178 3.11
Reforma Indicated 1,173 5.9 0.58 262 4.74
Total Indicated 4,933 6.37 0.45 166 2.14
Inferred 483 6.26 0.63 160 1.96

** Using 5% zinc grade cut-off grade



CONFERENCECALL

Management will discussthis statement in a conference call with the investment community on 16 Novemberat 9:00am Central European Time, 8.00am UK Time. The presentation will bewebcast live on the Nyrstar website, www.nyrstar.com, and will also beavailable in archive.

The call can also beaccessed using the following dial-in numbers:
Country Toll Number
UK [phone]
Belgium [phone]
France [phone]
Germany [phone]
Switzerland [phone]
USA [phone]
Canada [phone]
Australia [phone]



If your country is notlisted above please dial the international number:[phone].

1. Please dial in 5 minutes priorto the call

2. Ask for the Nyrstar call, andadvise your name and company name

3. You will then be placed on holduntil the conference starts


- end -



About Nyrstar

The partner of choice in essential resources for the development of a changing world. Nyrstar is a leading global multi-metals business, producing significant quantities of zinc and lead as well as other products (including silver, gold and copper). Nyrstar is listed on NYSE Euronext Brussels under the symbol NYR. For further information visit the Nyrstar website, www.nyrstar.com.


[1] C1 cash costs are the net direct cash costs incurred from mining through to refined metal (including operating costs, treatment charges, concentrate freight costs), less by-products credits.


IMPORTANT INFORMATION

This announcement has been prepared by Nyrstar NV (the "Company"). It does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the Company or any member of its group nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities of the Company or any member of its group, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever.

The information included in this announcement has been provided to you solely for your information and background and is subject to updating, completion, revision and amendment and such information may change materially. Unless required by applicable law or regulation, no person is under any obligation to update or keep current the information contained in this announcement and any opinions expressed in relation thereto are subject to change without notice. No representation or warranty, express or implied, is made as to the fairness, accuracy, reasonableness or completeness of the information contained herein. Neither the Company nor any other person accepts any liability for any loss howsoever arising, directly or indirectly, from this announcement or its contents.

This announcement includes forward-looking statements that reflect the Company's intentions, beliefs or current expectations concerning, among other things, the Company's results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth, strategies and the industry in which the Company operates. These forward-looking statements are subject to risks, uncertainties and assumptions and other factors that could cause the Company's actual results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth or opportunities, as well as those of the markets it serves or intends to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. In particular, information about the completion of the transactions contemplated by the Nyrstar Offer, the Company's future plans for the operation and financial results of the G-9 Mine, and the ability of the Company to continue mineral exploration in the Campo Morado Operation constitute forward-looking statements.

The Company cautions you that forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition, exploration potential, liquidity, performance, prospects, growth or opportunities and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this announcement. In addition, even if the Company's results of operations, financial condition, exploration potential, liquidity , performance, prospects, growth or opportunities and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments in future periods. The Company and each of its directors, officers and employees expressly disclaim any obligation or undertaking to review, update or release any update of or revisions to any forward-looking statements in this announcement or any change in the Company's expectations or any change in events, conditions or circumstances on which these forward-looking statements are based, except as required by applicable law or regulation.

The Company also cautions you that mineral reserve and mineral resource estimates for development projects are, to a large extent, based on interpretations of geological data obtained from drill holes and other sampling techniques and feasibility studies which derive costs based on anticipated tonnage and grades of ores to be mined and processed, the configuration of the ore body, expected recovery rates of metal from the ore, estimated operating costs, estimated capital costs, estimated site remediation costs and asset retirement costs, anticipated climatic conditions and other factors. There is significant uncertainty in any mineral resource estimate and the actual deposits encountered and the economic viability of a mineral deposit may differ materially from the Company's or Farallon's estimates. Mineral resources which are not mineral reserves do not have demonstrated economic viability

This document and any materials distributed in connection with this document are not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction.

The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about and observe any such restrictions. The Company's shares have not been and will not be registered under the US Securities Act of 1933 (the "Securities Act") and may not be offered or sold in the United States absent registration under the Securities Act or exemption from the registration requirement thereof.



Contacts



Investors
Anthony Simms
Manager, Investor Relations
T: [phone]
M: [phone]
[e-mail]

Media
Geert Lambrechts
Manager,
Corporate Communications
T: [phone]
M: [phone]
[e-mail]

http://www.nyrstar.com/nyrstar/en/media/pressreleases/?sid=/PR/201011/1462791.xml

[the cork]

FRLIF Holiday schedule for US and Canadian markets...Happy Farallon Thanksgiving Gang!
(special thanks to basserdan)

US markets:

-closed on Thursday

-open as usual Friday morning, but closing early for the day... at 1 pm EST (10 am PST)

Canadian markets:

-normal hours on both Thursday and Friday

[the cork]

Zinc adds, Copper Advances on Speculation Mine Strike in Chile May Cut Into Supply
By Maria Kolesnikova - Nov 24, 2010 6:10 AM PT

Copper rose for the first day in three in New York on speculation that supply may tighten further as a strike at the world’s fourth-biggest mine continues.

Anglo American Plc and Xstrata Plc’s Collahuasi venture in Chile said it will ignore union calls to resume wage talks and keep negotiating directly with workers in a bid to end the strike, which helped drive copper to a record this month. Prices also gained after the International Copper Study Group said the market’s supply shortfall jumped almost eightfold.

“The supply situation could tighten in the short term if the strike at Collahuasi does not end soon,” Commerzbank AG said in a report.

Copper for delivery in March added 4.4 cents, or 1.2 percent, to $3.755 a pound at 8:57 a.m. on the Comex in New York. Copper for delivery in three months climbed 1.3 percent to $8,245 a metric ton on the London Metal Exchange. All of the six main metals traded on the LME gained, led by nickel.

Acceptances of Collahuasi’s offer have fallen short of the required 756, from the 1,551-strong union, to dissolve the strike under Chilean law, threatening to prolong the action.

World copper consumption exceeded output by 363,000 tons in this year’s first eight months, compared with a 47,000-ton shortfall a year, the ICSG said last night by e-mail. Usage outpaced supply by 19,000 tons in August, it said.

‘Demand Surprises’

“Demand recovery momentum continued to pick up pace, with usage jumping 13% year-on-year (up from 6% the previous month), above our expectations and continuing this year’s trend of upside demand surprises,” Barclays Capital said in a report.

Copper also gained as German business confidence unexpectedly rose to a record in November and Europe stocks and U.S. index futures gained. The Munich-based Ifo institute said its business climate index rose to 109.3, the highest level since records for a reunified Germany began in 1991. Economists predicted a decline to 107.5.

The metal fell in the past two sessions as the dollar gained amid concern about Europe’s sovereign-debt crisis. A stronger dollar makes metals priced in the currency more expensive in terms of other monies. Copper also slid on concern demand may wane as China moves to limit inflation.

“Prices could fall below $8,000 over the near term, given the potential for further risk in peripheral Europe and the strong likelihood that China moves again to raise reserve requirements or interest rates before the end of the year,” said Daniel Brebner, an analyst at Deutsche Bank AG in London.

Higher Premium

Immediate-delivery LME copper’s premium to the three-month contract jumped 15 percent to $32.25 a ton today. Prices moved on Nov. 8 to a so-called backwardation, when nearby metal trades above longer-dated contracts, potentially indicating concern about near-term supply.

Copper stockpiles tracked by the LME slid for a 14th day to 357,125 tons today, the lowest level since Oct. 19, 2009, daily exchange figures showed. Orders to draw copper from LME inventories, or canceled warrants, dropped 1.9 percent to 31,725 tons.

Tin for three-month delivery on the LME rose 2.1 percent to $24,400 a ton. Prices reached a record $27,500 on Nov. 9. The metal has jumped 44 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of Congo.

Aluminum rose 0.6 percent to $2,268 a ton and nickel climbed 2.5 percent to $22,145 a ton. Lead gained 1.8 percent to $2,225 a ton and zinc added 1.4 percent to $2,115 a ton.

http://www.bloomberg.com/news/2010-11-24/copper-climbs-for-first-time-in-four-days-on-reduced-concern-about-korea.html

[the cork]

Lead loses, Copper, Zinc Drop as China Credit Cooling May Hurt Metal Demand (Don't believe it)
By Bloomberg News - Nov 22, 2010 11:06 PM PT

Copper, zinc and aluminum declined as China increased steps to curb loans and cool inflation, curbing consumption in the world’s biggest user. Concern Europe’s debt problems may spread boosted the dollar versus the euro, hurting demand for commodities priced in the U.S. currency.

The three-month delivery contract on the London Metal Exchange dropped 1.8 percent to $8,140 a metric ton at 2:46 p.m. in Singapore. The metal for March delivery on the Shanghai Futures Exchange slumped 3.3 percent to 61,320 yuan ($9,222). Zinc for March delivery tumbled the 5 percent limit in Shanghai.

Copper “is facing resistance as physical demand isn’t so good in China.”, Cao Yanghui, an analyst at Yong’an Futures Co., said from Hangzhou. “Europe’s debt crisis helped the dollar and in turn weighed on copper.”

China’s biggest banks are close to reaching annual lending quotas and plan to stop expanding their loan books to avoid exceeding the limits, according to four people with knowledge of the matter. Industrial & Commercial Bank of China Ltd., Bank of China Ltd. and Agricultural Bank of China Ltd. are only extending new loans as existing ones get repaid, the people said, speaking on condition of anonymity.

Moody’s Investors Service said it may lower Ireland’s credit rating by more than previously anticipated. A “multi- notch” downgrade to the country’s Aa2 rating was “most likely,” it said.

A bailout of the country’s banks may total as much as 95 billion euros ($130 billion), making Ireland vulnerable to a rerun of the Greek debt crisis that destabilized the euro earlier this year, Moody’s said.

Euro Weakens

The euro weakened versus 12 of its 16 most-active counterparts and declined for a second day against the dollar, dropping as much as 0.7 percent to $1.3527.

With little economic data expected this week, base metals may continue to track the dollar, while the Thanksgiving holiday in the U.S. may deter the market from taking any aggressive action, Leon Westgate, an analyst at Standard Bank Plc in London, said in a research note e-mailed today.

“A general feeling of uncertainty and a lack of momentum still dominates, with metals likely to continue reacting to headlines and other exogenous factors this week, rather than forging a path of their own,” he said.

Copper traded on Changjiang, Shanghai’s biggest nonferrous metals market, was quoted at 61,700 yuan to 61,800 yuan today, a discount of 100 yuan to 200 yuan to the front- month futures contract on the Shanghai Futures Exchange.

Consumer Demand

“Trading firms said demand from end consumers is not good, because winter is approaching,” Cao said.

Demand for metals typically increases in spring and autumn, and weakens in summer and winter as extreme weather conditions and holidays may force some plants to suspend operations.

Chinese imports will likely remain low through to the end of the year as the domestic market continues to trade at a large physical discount and exchange warehouse stocks expand to levels not seen since June, Barclays Capital said in a report yesterday. The implied destocking along the supply chain indicated imports may pick up in early 2011, it said.

Aluminum in London fell 1.3 percent to $2,259 a ton, zinc declined 1.7 percent to $2,101 a ton and lead lost 2.2 percent to $2,200 a ton. Nickel lost 1.5 percent to $21,271 a ton.

http://www.bloomberg.com/news/2010-11-23/copper-drops-in-london-and-shanghai-on-europe-debt-china-demand-concerns.html

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Lead climbs, Copper, Aluminum Advance in London Trading as Dollar Slumps: LME Preview
By Bloomberg News - Nov 22, 2010 1:00 AM PT

Copper led an advance in base metals after Ireland sought international help to avoid becoming the second euro nation to need a rescue, preventing potential contagion and boosting the global economic outlook.

The metal for three-month delivery climbed as much as 1.3 percent to $8,516.75 a metric ton on the London Metal Exchange, and traded at $8,444 at 4:38 p.m. Singapore time. Aluminum increased 1.5 percent to $2,293.75 a ton and zinc gained 1.5 percent to $2,191.75 a ton.

“Copper is seeking direction amid an unclear macro picture in China, so it’s prone to be moved by the dollar and outside markets in the short term,” Liang Haisan, an analyst at Citic Newedge Futures Co., said by phone from Shanghai.

Irish Prime Minister Brian Cowen said on Nov. 21 in Dublin that he expects talks on the details of financial assistance for the country to be completed in the “next few weeks.” Finance Minister Brian Lenihan said the loan will be less than 100 billion euros ($137 billion).

The euro rose for a fourth day against the dollar, reaching a one-week high after European Union finance ministers said the deal will create a capital fund for Ireland’s lenders. The Dollar Index, which tracks the greenback against the currencies of six major U.S. trading partners including the euro, yen and pound, declined for a fourth day, losing as much as 0.7 percent.

Concern that tightening measures to cool inflation in China may have a negative impact on demand for commodities is exaggerated, JPMorgan Chase & Co. said in a note today.

“While the property sector in China will likely slow going into 2011 and there may be oversupply concern in the sector next year, there are enough infrastructure projects in the pipeline to ensure that fundamentals for China’s commodity demand will remain strong next year,” the report said.

Ratio Hike

China, the world’s largest metals consumer, ordered banks to set aside larger reserves for the second time in two weeks, raising the requirement 50 basis points starting Nov. 29, the central bank said on its website after Chinese markets closed Nov. 19. The aim is to step up liquidity management and “appropriately control” credit and loans, it said.

China’s reserve-ratio increase provided temporary relief to the market today, Tan Wentao, an analyst at HNA Topwin Futures, said by phone from Shanghai. “In this round of price controls, agricultural products are in focus, so metals should be less affected,” Tan said.

Copper for March delivery in Shanghai declined 1.3 percent to close at 63,420 yuan ($9,550) a ton.

China’s inflation may reach 6.3 percent next year, so the country may raise interest rates and the reserve requirement ratio by at least 150 basis points each over the next year to fight inflation, the Securities Times cited Tao Dong, a Credit Suisse Group AG economist in Hong Kong, as saying.

Imports Slump

Imports by China tumbled to the lowest level in two years, according to data provided by the customs department today. Shipments declined 30 percent to 169,897 tons in October, the lowest level since November 2008, as ample domestic supply and high international prices deterred buyers.

Copper stockpiles monitored by the Shanghai Futures Exchange increased to the highest level in five months as of Nov. 19. Inventories of copper gained for a third week, adding 11,313 tons to 126,736 tons, based on a survey of seven warehouses in Shanghai, the exchange said on its website.

Lead in London advanced 1 percent to $2,300 a ton, nickel gained 1 percent to $22,060 a ton and tin increased 0.8 percent to $25,200 a ton.

http://www.bloomberg.com/news/2010-11-22/copper-gains-in-london-as-dollar-drop-boosts-demand-correct-.html

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Lead drops, Copper Set for Biggest Weekly Dip in Two Months on China Concern
By Bloomberg News - Nov 18, 2010 11:34 PM PT

Nov. 18 (Bloomberg) -- George Gero, senior vice president at RBC Capital Markets, discusses gold prices and the outlook for the precious-metals market. Gero speaks from Chicago with Lisa Murphy on Bloomberg Television's "Fast Forward." (Source: Bloomberg)

Copper in London fluctuated, heading for the biggest weekly drop in two months, on concern additional tightening measures in China may damp demand from the biggest consumer.

The metal for three-month delivery lost as much as 1.3 percent to $8,320 a metric ton on the London Metal Exchange before advancing 0.4 percent to $8,460 at 3:01 p.m. in Shanghai. Prices have fallen 1.8 percent this week, the most since the week ending Sept. 10. Copper for February delivery in Shanghai closed 2.1 percent higher at 64,010 yuan ($9,644) a ton.

“Given the inflation situation in China, I don’t think the government has rolled out all the tightening measures,” Che Hongyun, chief metals analyst at Galaxy Futures Co., said by phone from Beijing. “Policy signals from China and the U.S. dollar will provide directions in the short term.”

Inflation in China may reach 3.8 percent in the fourth quarter, the China Securities Journal reported today, citing estimates by the State Information Center. Inflation may exceed the government’s 3 percent target for this year, the report said citing the agency, which is under the National Development and Reform Commission.

Consumer prices accelerated to 4.4 percent in October from a year earlier, the fastest pace since September 2008. The central bank on Oct. 19 unexpectedly raised the one-year lending rate by 25 basis points to 5.56 percent, and lifted the deposit rate by the same margin to 2.5 percent.

‘Big Problem’

The country needs to raise interest rates and allow its currency to appreciate to curb inflation, said Vincent Chan, head of China region research at Credit Suisse Group AG in a Bloomberg Television interview today. China has a “big inflation problem,” he said.

China’s plans to attack inflation with subsidies, sales of food reserves and the threat of price controls are likely to prove insufficient, and the central bank will have to raise interest rates further, according to a survey of economists this week at nine banks by Bloomberg News.

“Copper’s decline earlier this week damped confidence,” Yu Ye, an analyst at Minmetals Futures Co., said by phone from Shenzhen. If the U.S. dollar falls, copper may recover a bit, otherwise, it’s capped by the macro uncertainties for now, she said.

The Dollar Index, which tracks the greenback against the currencies of six major U.S. trading partners including the euro, yen and pound, declined for a third day, falling 0.2 percent to 78.411.

Chile Strike

Miners at Anglo American Plc and Xstrata Plc’s Collahuasi copper unit in northern Chile will likely continue a strike because an increased bonus offer doesn’t meet salary demands, a union leader said yesterday.

Miners, on strike for 14 days, are willing to resume collective negotiations, union official Cristian Arancibia said in an interview in Iquique, Chile. Collahuasi started sending individual letters to miners on Nov. 17, offering a bonus of 14 million pesos ($29,096) for those who return to work by Nov. 23. The union rejected a Nov. 5 offer that included a bonus of 11.5 million pesos plus loans of 2 million pesos.

Aluminum in London gained 0.2 percent to $2,313 a ton, zinc rose 1.7 percent to $2,223.25 a ton, and lead increased 1.3 percent to $2,345.25 a ton. Nickel added 0.2 percent to $21,900 a ton, and tin advanced 1.2 percent to $25,399 a ton at 3:03 p.m. in Shanghai.

http://www.bloomberg.com/news/2010-11-19/copper-poised-for-biggest-loss-in-two-months-on-china-tightening-concern.html

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Lead up, Copper Gains in Shanghai, London as China Curb Concern Eases; Zinc Jumps
By Bloomberg News - Nov 17, 2010 11:41 PM PT

Copper in Shanghai rallied after falling 11 percent in four days and London prices extended yesterday’s gains as China’s clarification on price controls improved investor confidence and as the dollar weakened.

February-delivery metal on the Shanghai Futures Exchange climbed 1.9 percent to close at 62,720 a ton. The three-month delivery contract in London advanced 1.5 percent to $8,310 a ton at 3:10 p.m. in Shanghai. Zinc gained 3.6 percent to $2,189.

“As news about how Beijing plans to curb inflation came out, it helped to alleviate the policy uncertainties, giving some relief to the market,” Ren Gang, an analyst at Maike Futures Co., said by phone from Shanghai.

China’s State Council said on its website yesterday that price caps will be used on “important daily necessities” and production materials if necessary, following a meeting chaired by Premier Wen Jiabao. The cabinet pledged to stabilize natural gas prices, crack down on speculation in farm products and ensure the supply of vegetables, grain, cooking oil and sugar.

“Short-position holders chose to lock-in profits, and the relatively low open interest and trading volumes amplified the price move,” Ren said. “We need to wait for a few days to see how the physical markets react.”

Cash Market

Copper traded on Changjiang, Shanghai’s largest nonferrous metals market, was quoted around 62,050 yuan a ton today, or a discount of 50 yuan to 150 yuan to Shanghai’s front-month futures contract.

China sold 16,353 tons of lead ingots offered at a state auction on Nov. 16, the National Development and Reform Commission said in a statement on its website today. The metal was sold at an average price of 17,030 yuan a ton, it said.

The U.S. currency declined against 13 of its 16 major counterparts on speculation the Federal Reserve will follow through on its stimulus plan to buy $600 billion in bonds. The Dollar Index, which tracks the greenback against a basket of currencies, dropped as much as 0.5 percent to 78.699.

“Following the steep losses in the past few days, the dollar’s retreat since yesterday seems to be at least partially and temporarily offsetting the tightening worries,” said Li Peiying, an analyst at Essence Futures Co., by phone.

Aluminum in London rose 1.1 percent to $2,300 a ton, and lead gained 2.2 percent to $2,314 a ton. Nickel increased 1.6 percent to $21,889 a ton, and tin advanced 2.6 percent to $25,400 a ton at 3:10 p.m. in Shanghai.

http://www.bloomberg.com/news/2010-11-18/copper-climbs-in-shanghai-little-changed-in-london-after-drop-zinc-gains.html

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Gold and silver down, Copper, Zinc Plunge Limit in Shanghai on China Tightening Risk

Copper and zinc futures tumbled as much as 5 percent in Shanghai, the maximum allowed by the bourse, after metals in London slumped the most in more than six months yesterday on speculation China, the biggest consumer, will take steps to cool inflation, curbing demand.

Copper for February delivery on the Shanghai Futures Exchange closed limit-down at 61,550 yuan ($9,259) per metric ton. Zinc for March delivery fell to 17,815 a ton. Three-month copper on the London Metal Exchange declined 1 percent to $8,070 a ton at 3:05 p.m. after sliding 5.7 percent yesterday.

The LME index, comprised of six industrial metals, slumped the most since May 4 yesterday as zinc plunged 8.5 percent, the biggest drop in six months. China’s inflation climbed to 4.4 percent in October, the fastest pace in two years, prompting speculation that the government will raise interest rates.

“The precipitous fall indicates investors have become increasingly risk-averse, as the strong rally in the past few months seems vulnerable, given probable tightening measures in China,” Wang Ning, an analyst at Xiangyu Futures Co., said by phone from Shanghai.

Chinese Premier Wen Jiabao said the cabinet is drafting measures to counter excessive price gains. The comments, broadcast last night local time on state television, suggested the government would intensify efforts to cool inflation.

“What I’ve seen was a lot of liquidation of long positions as investors retreat from the market and wait until they get a clearer macro picture,” Wang said.

Confidence Falls

A Chinese consumer confidence index fell for the first time in six quarters on expectations that the price of goods and services will keep increasing. The measure dropped to 104 in the third quarter from 109 in the previous three months, according to a statement from Nielsen Co. and the Chinese statistics bureau’s Economic Monitoring and Analysis Center.

“The rebound in inflation expectations among consumers has curbed their willingness to spend,” the statement said today.

Investor confidence was also dented by discussions between Ireland and European and International Monetary Fund officials over a bailout that would enable the country to inject capital into the country’s banks.

Copper futures in Shanghai declined 11 percent in the past four sessions, heading for the biggest four-day slide since December 2008. Zinc slid 16 percent in the period, and was poised for the largest drop since November 2007.

China’s central bank may raise rates as soon as Nov. 19 because of sustained inflationary pressure, the China Securities Journal said today. Earlier announcements also indicate that rate decisions are often released on Fridays or around the 20th of the month, the newspaper reported.

Stocks in China declined, with the Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, closed 1.9 percent lower at 2,838.86.

Aluminum in London gained 0.2 percent to $2,246 a ton, zinc declined 2.9 percent to $2,078 a ton, and lead dropped 2.7 percent to $2,195 a ton. Nickel climbed 0.9 percent to $21,005 a ton, and tin dropped 1.5 percent to $24,150 a ton at 3:04 p.m. in Shanghai.

http://www.bloomberg.com/news/2010-11-17/copper-zinc-plunge-limit-in-shanghai-on-chinese-rate-increase-speculation.html

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Farallon Mining Target Raised To C$0.80 From C$0.65 By Raymond James >FAN.T
Last update: 11/16/2010 7:08:46 AM
(END) Dow Jones Newswires (212-416-2400)
November 16, 2010 07:09 ET (12:09 GMT)

http://custom.marketwatch.com/custom/tdameritrade-com/html-story.asp?guid={5d594c38-d6f6-4f6e-958a-19796c1ff128}

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Zinc falls, Copper Drops on Concern China May Take More Steps to Slow Economic Growth
By Maria Kolesnikova - Nov 16, 2010 5:30 AM PT

Copper fell in New York and London on concern that China, the world’s biggest consumer of the metal, may take further steps to cool economic growth, damping demand for commodities.

China is under “pressure” from capital inflows, central- bank Governor Zhou Xiaochuan said as a state newspaper reported that price controls may be imposed to cool the fastest inflation in two years. The country’s benchmark money-market rate yesterday rose to a one-week high. Chinese stocks fell today, driving the benchmark index to a one-month low.

“Copper is down again this morning after Chinese equities took another pounding as the potential for Chinese monetary- policy tightening continued to weigh on investors and conspired to drag prices lower,” Alex Heath, head of industrial-metals trading at Royal Bank of Canada Europe Ltd. in London, said in a report.

Copper for delivery in March dropped 7.45 cents, or 1.9 percent, to $3.85 a pound at 8:16 a.m. on the Comex in New York. Copper for delivery in three months declined 2.2 percent to $8,459 a metric ton on the London Metal Exchange. All of the six main metals traded on the LME slid, led by zinc.

LME copper may return to $8,000 a ton after the recent rally to a record, William Adams, an analyst at Basemetals.com in London, said by telephone. Copper rose to an all-time high of $8,966 on Nov. 11.

Swifter Inflation

“Markets will remain nervous until we see what kind of response China comes up with,” Adams said.

Chinese inflation sped up to a two-year high in October, figures showed on Nov. 11, stoking speculation that the central bank may further tighten monetary policy as the economy maintains momentum. Interest rates will rise again before year- end after an increase in October that was the first since 2007, according to a Bloomberg News survey of economists.

“Inflationary pressures have been building, and further rate hikes are due,” RBC’s Heath said. China will raise borrowing costs “very soon” to tackle inflation, Andy Xie, an independent economist, said in a Bloomberg Television interview in Hong Kong.

Figures due at 9:15 a.m. New York time today probably will show that industrial production in the U.S., the second-largest copper consumer, expanded in October, according to a Bloomberg News survey of 78 economists. Output gained 0.3 percent, the survey’s median estimate shows.

Copper Premium

“Economic data in the U.S. tends to be better lately, so that will just add to the volatility in the market,” said Adams of Basemetals.com.

Immediate-delivery LME copper’s premium to the three-month contract was last unchanged at $25 a ton after almost doubling yesterday. Prices moved on Nov. 8 to a so-called backwardation, when nearby metal trades above longer-dated contracts, potentially indicating concern about near-term supply.

Workers at Anglo American Plc and Xstrata Plc’s Collahuasi copper mine in northern Chile will lower their wage demands in government-mediated talks to end an 11-day strike if the company increases its proposal, union leader Manuel Munoz said in an interview with Bloomberg News yesterday.

Tin for three-month delivery on the LME dropped 2.5 percent to $25,250 a ton. Prices reached a record $27,500 on Nov. 9. The metal has jumped 49 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of Congo.

Aluminum slid 2.1 percent to $2,350 a ton and nickel declined 0.9 percent to $22,147 a ton. Lead dropped 2.5 percent to $2,393 a ton and zinc fell 3.4 percent to $2,258 a ton.

http://www.bloomberg.com/news/2010-11-16/copper-drops-on-concern-china-may-take-more-steps-to-slow-economic-growth.html

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Zinc slips 2.3%, Copper Fluctuates on Gain in U.S. Retail Sales, China Tightening Concern
By Maria Kolesnikova - Nov 15, 2010 6:16 AM PT

Copper fluctuated in New York on concern that China may take more steps to curb its economic growth and a stronger-than-estimated gain in retail sales in the U.S., the world’s second-biggest user of the metal.

U.S. purchases climbed 1.2 percent in October, the most since March, Commerce Department figures showed today. Earlier copper slid as much as 1.2 percent on the Comex, after falling the most in four months on Nov. 12, on concern that China might take more steps to slow its economy.

“The market has certainly been unnerved by the Chinese tightening fears, though the market also seems very bullish as to copper’s longer-term prospects, with the recent selloff triggering dip-buying interest,” Leon Westgate, an analyst at Standard Bank Plc in London, said in a report today.

Copper for delivery in March rose 0.8 cent, or 0.2 percent, to $3.906 a pound at 8:59 a.m. on the Comex. The most-active contract added as much as 1.5 percent. Copper for delivery in three months dropped 0.3 percent to $8,586 a metric ton on the London Metal Exchange.

The median estimate of 74 economists surveyed by Bloomberg News projected a 0.7 percent advance in U.S. retail sales. Figures due tomorrow may show that industrial production in the country gained in October after falling in the prior month, according to a separate survey.

Bank Reserves

Copper slid earlier today as China’s benchmark money-market rate rose to the highest level in seven days after the central bank ordered lenders to set aside more funds as reserves. The country is the world’s largest copper user.

The People’s Bank of China may raise interest rates twice late this year and early next year, the Economic Daily reported on its website today, citing Chen Xikang, a researcher with the Chinese Academy of Sciences.

Industrial metals may decline by another 10 percent to 15 percent in coming weeks, according to Robin Bhar, an analyst at Credit Agricole SA’s investment-banking unit in London.

“We’ve rallied strongly, particularly in copper, and for copper we could come back to look at the $8,000 level, which is a key psychological level,” he said. “We’ve rallied from $7,000 to a new high in copper very, very quickly, so to give something back wouldn’t be unexpected.”

Mine Strike

In Chile, Anglo American Plc and Xstrata Plc continued to produce copper at a normal rate at the Collahuasi mine, the world’s fourth-largest, as a strike by workers entered a 12th day. LME copper rose to a record $8,966 a ton last week, partly on concern shipments at the mine, which accounts for more than 3 percent of world production, may be disrupted.

Zinc for three-month delivery on the LME slid 2.3 percent to $2,339 a ton and lead declined 2.4 percent to $2,460 a ton. Growth in Chinese lead consumption probably will slow to 11 percent in 2010 from 16.5 percent last year as demand from auto production and telecommunications weakens, according to Beijing Antaike Information Development Co.

Tin for three-month delivery on the LME fell 2.9 percent to $25,380 a ton. Prices reached a record $27,500 on Nov. 9. The metal has jumped 50 percent this year, leading LME advances, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Aluminum declined 0.9 percent to $2,382 a ton and nickel dropped 0.7 percent to $22,525 a ton.

http://www.bloomberg.com/news/2010-11-15/copper-falls-for-second-day-on-concern-china-may-move-again-to-curb-growth.html

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Zinc falls 4.7%, Copper Drops From Record on LME, by Limit in Shanghai, on China Tightening
By Glenys Sim - Nov 12, 2010 12:14 AM PT

Copper tumbled from a record in London and dropped by the daily limit in Shanghai, as some investors deemed the rally excessive on concern that China may step up measures to tighten economic policy, potentially curbing demand for industrial metals. Other base metals also slumped.

Copper for three-month delivery on the London Metal Exchange fell as much as 2.9 percent to $8,575 a metric ton and traded at $8,579 at 4:09 p.m. Singapore time. The contract, which reached a record $8,966 a ton yesterday, is down 0.9 percent this week.

“The rally before was excessive so we’re seeing an equally strong pullback,” Li Rong, chief analyst at Great Wall Futures Co., said from Shanghai. “Speculation is rife that China may hike interest rates again as early as this evening.”

December-delivery copper on the Comex in New York fell as much as 2.9 percent to $3.911 a pound, while Shanghai futures dropped the daily 5 percent limit to 65,640 yuan ($9,899) a ton.

“It’s an aggressive decline across the board as longs liquidate at the end of a week which saw a phenomenal rise in prices,” Rao Zhi, an analyst at Yunchen Futures Co., said from Yunnan. “The longer-term positive fundamentals, especially for copper, remain intact and the recovery story hasn’t changed.”

Zinc led declines on the London Metal Exchange, falling as much as 4.7 percent, the most since Sept. 9, to $2,422.50 a ton. China sold almost all of the 50,000 tons of zinc ingots it offered at a state auction on Nov. 9 for an average price of 19,511 yuan a ton, the National Development and Reform Commission said today.

China Tightens

China will raise interest rates by 25 basis points before the end of the year after producer and consumer prices took both markets and the government “by surprise,” HSBC Holdings Plc. said today. Consumer prices gained a more-than-forecast 4.4 percent from a year earlier in October, the statistics bureau said yesterday.

Policy makers raised reserve requirements for some banks twice yesterday, taking the total increase to 100 basis points for a few lenders, said two people with direct knowledge of the situation. China last month raised interest rates for the first time since 2007 to cool inflation and has taken multiple measures since April to curb property speculation.

Aluminum in London fell 1.5 percent to $2,420 a ton, lead declined 3.3 percent to $2,525 a ton, nickel decreased 2.5 percent to $23,400 a ton, and tin slumped 3.2 percent to $26,125 a ton.

http://www.bloomberg.com/news/2010-11-12/copper-futures-drop-on-concern-china-to-boost-measures-to-combat-inflation.html

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Zinc climbs, Copper Rises to Record in London on Chinese Economic Reports
By Maria Kolesnikova and Glenys Sim - Nov 11, 2010 5:44 AM PT

Copper rose to a 30-month high in New York and touched a record in London as reports showed higher factory output and stronger inflation in China, the world’s biggest consumer of the metal.

Industrial production advanced 13.1 percent and retail sales gained 18.6 percent in October from a year earlier, China’s government said. Inflation reached a two-year high, stoking demand for commodities as a hedge against rising prices. China also reported a drop in its copper production.

“The latest Chinese production data masks underlying strong copper demand,” Gayle Berry, an analyst at Barclays Capital in London, said by telephone. “And when you look at the economic data, it’s also suggestive of continued strong growth in metals demand.”

Copper for December delivery added 7.65 cents, or 1.9 percent, to $4.0455 a pound at 8:28 a.m. on the Comex in New York. Prices touched $4.0835, the highest level since May 5, 2008, when the most-active contract reached a record $4.2605.

Copper for three-month delivery on the London Metal Exchange advanced 1.4 percent to $8,880 a metric ton. The contract rose as high as $8,966, surpassing the previous peak of $8,940 set in July 2008.

‘Robust’ Figures

“Prices are being supported by firm Asian equity markets and robust economic data from China,” Commerzbank AG said in a report.

Consumer prices gained a more-than-forecast 4.4 percent from a year earlier in October, a statistics bureau report showed in Beijing today. Yesterday China’s government increased bank reserve requirements. The country’s refined-copper production dropped 1.2 percent to 400,000 tons last month, the National Bureau of Statistics said.

Codelco, the world’s biggest copper producer, is increasing the surcharge on sales to South Korea next year by 32 percent, the second straight annual gain, said three industry executives with direct knowledge of the matter.

Copper will rise to $11,250 a ton next year, above a prior forecast of $8,000, Bank of America-Merrill Lynch said in a report.

“Heavily driven by continued tight mine supplies, copper has the strongest structural fundamentals among the base metals,” BofA-ML analyst Jason Fairclough said. The planned introduction of exchange-traded funds “should add to upward pressure on prices and physical premia,” he said.

Supply Shortage

Refined-copper output will lag behind demand by 435,000 tons next year, the first shortage since 2007, according to the International Copper Study Group.

Copper’s “supply-demand deficits look set to grow on emerging-market demand strength and improving demand from developed economies,” Goldman Sachs Group Inc. analysts including Jeffrey Currie wrote in a Nov. 9 report. The rundown in stockpiles may cause “periods of extreme volatility and price spikes.”

Copper also has gained on speculation that Federal Reserve asset purchases, or quantitative easing, will hurt the dollar, boosting demand for commodities as an alternative investment. The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, has dropped 12 percent from its 2010 peak on June 7.

Copper stockpiles in LME warehouses have shrunk 28 percent this year, on course for the first annual decline since 2004. Inventories were 362,950 tons today, the lowest level since October 2009.

Higher Premium

Immediate-delivery copper’s premium to the three-month contract rose 17 percent to $7 a ton yesterday. Prices moved on Nov. 8 to a so-called backwardation, when nearby metal trades above longer-dated contracts, potentially indicating concern about near-term supply. The backwardation is set to increase as supply drops and prices rise, BofA-ML’s Fairclough said.

Copper will likely rise further to $9,095 a ton, according to technical analysis from Barclays Capital. The metal is “only a short step away” from the “psychologically important” $9,000 level, according to the bank.

Copper is the second LME metal after tin to set a record in 2010 as the global economy recovers from its worst recession since World War II. Tin, up 59 percent this year, reached $27,500 a ton on Nov. 9 after production was disrupted in Indonesia, the biggest exporter, and the Democratic Republic of Congo.

Tin for three-month delivery on the LME rose 0.5 percent to $27,095 a ton, lead gained 0.5 percent to $2,618 a ton and zinc added 0.9 percent to $2,548 a ton. Aluminum advanced 1.1 percent to $2,476 a ton and nickel climbed 0.5 percent to $24,284 a ton.

http://www.bloomberg.com/news/2010-11-11/copper-surges-to-record-on-rising-china-inflation-supply-shortage-outlook.html

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Zinc slips, Copper Drops for First Day in Five in London as China Demand Outlook Dims
By Glenys Sim - Nov 9, 2010 8:01 PM PT

Copper futures in London fell for the first day in five, declining from near a record as China’s imports of the metal slumped and on speculation that the Chinese government will step up measures to rein in asset prices.

Copper for three-month delivery on the London Metal Exchange was 1.3 percent lower at $8,753 a metric ton at 11:52 a.m. in Singapore after earlier falling to $8,740.50. The contract reached $8,884 a ton yesterday, the highest level since July 2008, when it reached an all-time high of $8,940.

“The drop in imports was expected as it was unprofitable to ship metal into China,” said Fang Junfeng, an analyst at China International Futures (Shanghai) Co. Traders are “nervous today ahead of the CPI number tomorrow and what the government will do to next to fight rising prices,” referring to the consumer price index by its initials.

December-delivery copper on the Comex in New York fell as much as 1.6 percent to $3.9780 a pound, while Shanghai futures dropped as much as 1.1 percent to 67,250 yuan ($10,131) a ton.

China imported 273,511 tons of copper and products in October, the customs office said today. This is 26 percent less than the previous month and 4 percent lower than October 2009. Government data due for release tomorrow will show the inflation rate rose 4 percent in October, according to the median estimate of 28 economists surveyed by Bloomberg. That would be the highest in two years.

China’s property sales climbed for a third month in October, according to the statistics bureau today, even as prices rose 8.6 percent from a year earlier, adding to speculation that the government will step up measures to cool the market.

“We’ll see some pullbacks along the way as it’s hard to justify these levels fundamentally,” said Yan Lei, an analyst at Guoyuan Securities Co., referring to copper. “The rally is driven by investment and speculative demand, which has increased because of the enormous amount of liquidity.”

Aluminum in London fell 0.8 percent to $2,450 a ton, zinc dropped 2.3 percent to $2,520 a ton, and lead declined 1.3 percent to $2,574.25 a ton. Nickel decreased 1.5 percent to $24,250 a ton, and tin slipped 1.1 percent to $27,050 a ton.

http://www.bloomberg.com/news/2010-11-10/copper-drops-for-first-day-in-five-in-london-as-china-demand-outlook-dims.html

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Zinc adds, Copper Rises for Fourth Day, Reaches 28-Month High on Chinese Car Sales
By Maria Kolesnikova - Nov 9, 2010 6:00 AM PT

Copper rose for a fourth day in New York and London, reaching a 28-month high as auto sales climbed in China, the world’s largest consumer of the metal.

Chinese passenger-car sales gained at the fastest pace in six months in October as government incentives for fuel- efficient models boosted buying in the biggest auto market. Figures due tomorrow may show the nation’s trade surplus increased in October, according to economists surveyed by Bloomberg News.

“Strong Chinese passenger-car sales numbers appear to have helped the base-metal complex overnight,” said David Thurtell, an analyst at Citigroup Inc. in London. “Tonight’s Chinese trade data is the next major signpost.”

Copper for delivery in December added 6.7 cents, or 1.7 percent, to $4.0235 a pound at 8:42 a.m. on the Comex in New York. Prices reached $4.0435, the highest level since July 3, 2008. Copper for delivery in three months climbed 2 percent to $8,834 a metric ton on the London Metal Exchange, and tin advanced to a record.

“Prices hit a new 28-month high today as global currencies declined and the prospect of continued demand in China, coupled with increasing demand in the U.S. on the back of the new round of stimulus, pushed prices up,” analysts at Fairfax IS said in a report.

Weaker Dollar

The Federal Reserve last week said it would purchase an additional $600 billion of Treasuries through June to bolster the U.S. economy. Copper also gained as the U.S. Dollar Index, a six-currency gauge of the greenback’s strength, erased a climb and slid as much as 0.4 percent, making metals priced in the currency cheaper in terms of other monies.

“The dollar has now reversed, and that too is helping the red metal higher,” Alex Heath, head of industrial-metals trading at Royal Bank of Canada Europe Ltd. in London, said in a report.

Wholesale deliveries of cars, sport-utility vehicles and multipurpose vehicles in China increased 27 percent from a year earlier to 1.2 million last month, the China Association of Automobile Manufacturers said today. Even a small car contains about 15 kilograms (33 pounds) of copper, according to the Copper Development Association’s website.

Premium Rises

Immediate-delivery copper traded at the highest premium to the three-month contract since July 2009, a sign investors and traders may be more concerned about near-term supply. Cash metal’s premium expanded to $10, the highest level since July 16, 2009, from $5 in the prior session.

“It’s already a tight market,” Mark Pervan, senior commodity strategist at ANZ Banking Group Ltd. in Melbourne, said today by phone. “Now you’ve got concern about supply. We’re going to move into a deep deficit next year.”

Production will lag behind demand by about 200,000 to 300,000 tons in 2011, compared with the current oversupply, Pervan said.

Copper stockpiles monitored by exchanges in London, New York and Shanghai have shrunk 22 percent this year, accounting for about 11 days of global demand, based on Royal Bank of Scotland Group Plc’s estimate for usage this year of 18.2 million tons. That’s down from about 14 days in January.

Smaller Inventories

“To the extent that the market is likely to remain tight, we could expect the cash-3s to stay in a backwardation for most of 2011,” Citigroup’s Thurtell said, referring to the spread between immediate-delivery and three-month copper.

Prices also gained today as LME inventories of copper shrank for a third day to 364,875 tons and orders to draw copper from stocks, or canceled warrants, jumped 14 percent to 31,750 tons. The figures were “bullish,” Thurtell said.

Tin for three-month delivery on the LME rose 2.8 percent to $27,349 a ton after reaching $27,500. The metal has jumped 61 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of Congo.

Aluminum rose 1.1 percent to $2,457 a ton and nickel climbed 0.9 percent to $24,350 a ton. Lead gained 3 percent to $2,579.75 a ton and zinc added 2.5 percent to $2,540.50 a ton.

http://www.bloomberg.com/news/2010-11-09/copper-rises-for-fourth-day-reaches-28-month-high-on-chinese-car-sales.html

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Zinc drops, Copper Fluctuates as Dollar's Gain Saps Demand for Alternative Investment
By Maria Kolesnikova - Nov 8, 2010 5:36 AM PT

Copper fluctuated in New York as a stronger dollar sapped demand for commodities as an alternative investment, prompting some investors to sell the metal after last week’s rally.

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, gained as much as 0.8 percent. A stronger dollar makes metals priced in the currency more expensive in terms of other monies. Copper rose to a 28-month high on Nov. 5 on concern that a strike at the Collahausi mine in Chile would worsen supply shortages.

“Dollar strength is pressurizing base metals this morning,” Alex Heath, head of industrial-metals trading at Royal Bank of Canada Europe Ltd. in London, said in a report.

Copper for delivery in December was little changed at $3.95 a pound at 9:13 a.m. on the Comex in New York. The contract added as much as 0.8 percent and lost as much as 0.7 percent. Copper for delivery in three months rose 0.2 percent to $8,674 a metric ton on the London Metal Exchange.

“Copper is still trading against the dollar, consolidating after last week’s gains,” said Andrey Kryuchenkov, an analyst at VTB Capital in London. “Market participants are watching developments in Chile.”

Collahausi, a venture between Anglo American Plc and Xstrata Plc, was operating normally as unionized workers prepared for a fourth day of strikes, Bernardita Fernandez, a spokeswoman for the mine, said yesterday. Collahuasi is the world’s fourth-biggest copper mine.

Strike Length

The strike may reduce production if it were to last more than a week, Morgan Stanley analyst Hussein Allidina said in a report e-mailed today.

LME copper stockpiles fell 0.3 percent to 365,200 tons, the lowest level since Oct. 22, 2009. Last week inventories shrank for a 37th week in a row.

Hedge-fund managers and other large speculators decreased bullish bets on New York copper futures in the week ended Nov. 2, according to U.S. Commodity Futures Trading Commission data. Speculative long positions outnumbered short positions by 25,208 contracts on the Comex, the commission said in its Commitments of Traders report on Nov. 5. Net-long positions fell by 1,255 contracts, or 5 percent, from a week earlier.

Citigroup Inc. raised its copper price forecast for next year by 26 percent to $4.14 a pound, according to a report dated yesterday.

Aluminum for three-month delivery on the LME fell 0.3 percent to $2,445.50 a ton. China sold almost all the 96,000 tons of aluminum ingots it offered from the state reserve through public auctions on Nov. 1-2, according to a statement on the website of the National Development and Reform Commission.

Zinc dropped 1.9 percent to $2,480 a ton. The world’s largest metals user will also sell 50,000 tons of zinc ingots from state reserves at an auction tomorrow, the commission said on Nov. 3.

Tin fell 0.2 percent to $26,400 a ton. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 56 percent this year, leading advances on the LME, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Lead declined 0.1 percent to $2,503.50 a ton and nickel slid 0.8 percent to $24,258 a ton.

http://www.bloomberg.com/news/2010-11-08/copper-may-fall-as-stronger-dollar-erodes-investment-demand.html

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Zinc climbs, Copper Advances to 28-Month High as Strike at Chilean Mine May Curb Output
By Claudia Carpenter - Nov 5, 2010 3:24 AM PT

Copper Surges Toward Record, Fed’s Easing Increases Demand

Copper futures in London jumped 3.4 percent yesterday, the biggest gain since May 21. Photographer: Michele Tantussi/Bloomberg

Copper rose for a second day in London and New York, reaching a 28-month high after workers planned a strike for today in Chile, the world’s largest producer of the metal.

The strike at Collahuasi, the world’s fourth-largest copper mine, will start at 7 a.m. New York time, union official Jacqueline Cerda said yesterday. Inventories of copper in warehouses monitored by the London Metal Exchange have declined 27 percent this year, signaling demand already exceeds supplies. Stocks fell to a 2010 low on Nov. 3.

“Coming on top of an already tight market, the strike news just adds to the potential for higher copper prices,” said David Thurtell, an analyst at Citigroup Inc. in London.

Copper for delivery in three months climbed $76, or 0.9 percent, to $8,675 a metric ton at 10:05 a.m. on the LME. Futures for December delivery advanced 1 percent to $3.9515 a pound on the Comex in New York. Prices touched $8,769.50 and $3.9955, the highest since July 3, 2008.

LME copper may reach $9,000 a ton if the strike lasts for a month or two, Thurtell said. The metal rose to a record $8,940 in July 2008.

Collahuasi, owned by Xstrata Plc and Anglo American Plc, accounted for 3.5 percent of global output last year, according to Standard Bank Plc. The mine will continue to operate at full capacity using non-union employees and contract workers, company spokeswoman Bernardita Fernandez said yesterday.

LME copper has jumped 5.8 percent this week, heading for the biggest advance since the week ended July 23. Prices gained as the Federal Reserve said it would spend $600 billion to boost the economy in the U.S., the world’s biggest copper user after China, weighing on the dollar. A weaker dollar makes metals priced in the currency cheaper in terms of other monies.

Aluminum for delivery in three months on the LME climbed 0.7 percent to $2,475 a ton, zinc gained 1.1 percent to $2,540 a ton and lead slipped 0.2 percent to $2,525 a ton. Nickel added 0.4 percent to $24,600 a ton and tin was unchanged at $26,500 a ton.

http://www.bloomberg.com/news/2010-11-05/copper-gains-to-28-month-high-on-fed-stimulus-plan-aluminum-zinc-climb.html

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Zinc surges, Copper to Rally on `Mammoth Demand,' Standard Chartered's Haigh Forecasts
By Sungwoo Park - Nov 4, 2010 12:53 AM PT

Copper will extend a bull run as “mammoth demand” from China, the largest user, and supply constraints combine to drive the market into a deficit from next year until 2014, according to Standard Chartered Plc.

“We are seeing a serious reduction in the supply of copper at a time when demand is quite robust,” Michael Haigh, the bank’s global head of commodities research, said today in Seoul. “Copper will continue to perform incredibly well.”

Copper, used in pipes, advanced to within 5 percent of a record last month on increased demand, declining stockpiles and a weaker dollar. Factory output in China grew at the fastest pace in six months in October. Deutsche Bank AG said Nov. 2 that the metal’s outlook presented a “perfect storm” for bulls.

The “copper market, we believe, will be in deficit until 2013, maybe 2014,” Haigh said at a seminar. “Copper has really been an outlier in terms of its performance, but it is fundamentally driven.”

Three-month futures peaked at $8,940 a metric ton in July 2008, two months before the collapse of Lehman Brothers Holdings Inc. helped to pitch the global economy into recession. The metal, which touched $8,554 on Oct. 26, traded today at $8,499 at 3:46 p.m. in Singapore.

Record Price

Jeremy Gray, Standard Chartered’s global head of equity research for resources, forecast in an August report that copper may rise to $12,000 a ton in the next two years. None of the seven largest producers will bring on any new production next year or in 2012, the report said.

The three-month contract in London may average $7,850 a ton in the fourth quarter compared with $7,282 in the third, according to slides from Haigh. The price may average $8,325 a ton in 2011 compared with $7,369 in 2010, the slides showed.

“Things are not looking very rosy on the supply side given Chile and Peru’s reduction in output,” said Haigh, who joined Standard Chartered in July. “We are seeing mammoth demand for copper from China and these two suppliers cannot keep pace.”

The copper market may turn to a deficit of 723,000 tons in 2011 from a surplus of 112,000 tons this year, with the gap widening to 1.2 million tons in 2012 and further to 1.5 million tons in 2013, according to Haigh’s presentation. The Lisbon- based International Copper Study Group last month forecast a 2011 deficit of 435,000 tons.

LME copper stockpiles stood at 366,075 tons yesterday, the lowest level since October last year, according to exchange figures. They have shrunk 27 percent this year.

The economy in China, the top consumer of raw materials from copper to soybeans, grew 9.6 percent in the third quarter. Refined-copper consumption in China may expand 11.5 percent to 6.8 million tons this year, Yang Changhua, a senior analyst at Beijing Antaike Information Development Co., said yesterday.

http://www.bloomberg.com/news/2010-11-04/copper-to-surge-on-mammoth-demand-standard-chartered-s-haigh-forecasts.html

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Zinc dips, Copper Fluctuates With Dollar Ahead of Fed Announcement on Extra Stimulus
By Chanyaporn Chanjaroen - Nov 2, 2010 11:42 PM PT

Copper fluctuated with movements in the dollar before the result today of a Federal Reserve policy meeting which may agree further stimulus for the U.S. economy.

Three-month-delivery copper dropped as much as 0.5 percent to $8,395 a metric ton on the London Metal Exchange before trading at $8,426 at 2:26 p.m. Singapore time. The contract climbed 1.6 percent yesterday to the highest level since Oct. 27. December-delivery metal on the Comex in New York fell 0.2 percent to $3.833 a pound, while February futures in Shanghai added 0.9 percent to 64,080 yuan ($9,600) a ton.

The dollar fluctuated against a basket of six currencies. The Federal Reserve policy makers probably will announce a plan to purchase at least $500 billion of long-term securities, according to economists surveyed by Bloomberg News.

“The market is very nervous” ahead of the Fed’s decision, Yingxi Yu, an analyst at Barclays Capital in Singapore, said today by phone. A lower-than-expected spending program may boost the dollar and weaken copper prices briefly, she said.

Copper increased 14 percent this year as demand gathered pace in China, the world’s largest user, metal stockpiles shrank and the dollar weakened. Manufacturing activity picked up last month in the U.S., China and Europe, suggesting consumption for metals will remain robust, Stefan Graber, an analyst at Credit Suisse in Singapore wrote today in a report.

“Copper is very strong from a fundamental point of view,” said Barclays’s Yu. Stockpiles monitored by exchanges in Shanghai, London and New York dwindled 21 percent this year.

The World bank, while recommending China to raise interest rates further to curb inflation, said in a periodic report released today the Asian nation’s economic prospects remain “sound,” and boosted its estimate for China’s growth this year to 10 percent from a June forecast of 9.5 percent.

Chile Unions

A potential strike at the Collahuasi mine in northern Chile is also supporting copper prices, Mark Pervan, an analyst at ANZ Bank Ltd., wrote in a report today. The mine represents 3.5 percent of the world’s output, according to Standard Bank Plc.

A union at Collahuasi told members to prepare for a prolonged strike that may start Nov. 5, it said on its website after rejecting a new wage offer from the company. The mine management will resume talks with workers today, company spokeswoman Bernardita Fernandez said yesterday.

Copper consumption in China, the world’s top user, is estimated to increase by 11.5 percent to 6.8 million tons this year, Yang Changhua, an analyst at Beijing Antaike Information Development Co., said today at the China International Copper Conference in Ningbo. The estimate exceeds the researcher’s previous forecast for 10.7 percent growth.

“The investment stimulus package is still playing a role this year, supporting demand growth,” Yang said, referring to last year’s 4 trillion yuan government spending program to pump up growth during the financial crisis.

Zinc Sale

Aluminum and nickel in London were little changed at $2,426 a ton and $23,690 a ton. Tin increased 0.4 percent to $25,899 a ton, and lead climbed 0.1 percent to $2,493 a ton.

Zinc inventories tracked by the LME expanded almost 30 percent this year to 632,225 tons, according to the exchange’s report, the highest since January 2005. The metal price slipped 3.7 percent this year, the only loser among the six main base metals on the bourse.

China will sell 50,000 tons from state stockpiles in a Nov. 9 auction, the National Development and Reform Commission said in a statement. These reserves were bought from domestic smelters between February and May last year, it said.

“It will be the first public auction of zinc by the government,” Feng Juncong, an analyst at Beijing Antaike Information Development Co., said by phone today, forecasting a drop in prices. “It is probably to help offset reduced production as China is limiting power supplies to smelters.” Zinc fell 0.4 percent to $2,444 a ton,

http://www.bloomberg.com/news/2010-11-03/copper-may-increase-on-expectation-fed-stimulus-measures-may-buoy-demand.html

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Zinc adds, Copper Rises for Second Day as Dollar Drops Before Federal Reserve Meeting
By Maria Kolesnikova - Nov 2, 2010 5:03 AM PT

Copper rose for a second day in London as the dollar weakened before a Federal Reserve meeting that may result in further asset purchases to sustain a recovery in the world’s largest economy.

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, slid as much as 0.6 percent. Copper gained as much as 0.9 percent and fell as much as 0.2 percent as investors bought and sold 4,498 futures contracts, about 8 percent of volume for the entire Oct. 29 session. Also today, the U.S. holds midterm elections.

“Copper and the other base metals are range-trading ahead of the U.S. elections” and the Fed meeting, said Leon Westgate, an analyst at Standard Bank Plc in London. “Turnover has been very light, with the metals back in dollar-watching mode.”

Copper for delivery in three months climbed $61, or 0.7 percent, to $8,361 a metric ton at 11:49 a.m. on the London Metal Exchange. Copper for delivery in December added 0.5 percent to $3.8055 a pound on the Comex in New York. All of the six main metals traded on the LME gained, led by aluminum.

A slumping dollar makes metals priced in the currency cheaper in terms of other monies and spurs demand for raw materials as an alternative investment. The dollar index dropped for a second month in October as LME copper gained for a fourth month.

$500 Billion

Fed policy makers begin a two-day meeting today. The central bank is likely to start a fresh round of unorthodox stimulus tomorrow by announcing a plan to purchase at least $500 billion of long-term securities, according to economists surveyed by Bloomberg News.

In the U.S. elections, the Republicans are poised to retake the House of Representatives and narrow Democrats’ margin in the Senate, delivering a rebuke to President Barack Obama’s party in a campaign shaped by voter anxiety over jobs and the economy.

The copper market is in a “perfect storm” for bulls, and prices may reach new highs next year, John DeAngelis, director of metals strategy at Deutsche Bank AG, said at a conference today in the Chinese city of Ningbo. LME copper rose last month to a 27-month high.

The world financial crisis delayed development of mines, said Carlos Risopatron, head of environment and economics at the International Copper Study Group. World capacity to produce copper concentrate, the raw material for making refined metal, will expand by less than 2.5 million tons between 2010 and 2013 amid financing difficulties, according to the ICSG.

Copper Demand

“Better-than-expected manufacturing data emerging from the U.S., China and the U.K. yesterday has improved confidence that demand for copper will be sustained through the first quarter of next year,” analysts at Fairfax IS said today in a report.

Factory output in the U.S. expanded at the fastest pace in five months, while manufacturing in China grew at the fastest pace in six months in October, data yesterday showed. China and the U.S. are the world’s two biggest copper users. In the U.K., manufacturing growth unexpectedly accelerated in October and hiring improved as export orders increased.

Tin for three-month delivery on the LME rose 0.8 percent to $25,800 a ton. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 52 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Aluminum rose 1.6 percent to $2,410 a ton and nickel climbed 1.2 percent to $23,530 a ton. Lead gained 0.7 percent to $2,482 a ton and zinc added 0.2 percent to $2,455 a ton.

http://www.bloomberg.com/news/2010-11-02/copper-rises-for-second-day-as-dollar-drops-before-federal-reserve-meeting.html

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Zinc gains, Copper Rises on Chinese Manufacturing, Slumping Dollar; Aluminum Advances
By Maria Kolesnikova - Nov 1, 2010 4:39 AM PT

Copper rose in London as manufacturing accelerated in China, the world’s biggest consumer of the metal.

A purchasing managers’ index released by China’s logistics federation gained to 54.7 from 53.8 in September, and a second gauge published by HSBC Holdings Plc and Markit Economics jumped to 54.8 from 52.9. Prices also climbed as the dollar weakened and Asian stocks advanced. Raw materials from rice to crude oil rose.

“Commodity prices are supported by good economic data from China, firm equity markets in Asia and the weaker dollar,” said Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt.

Copper for delivery in three months climbed $115, or 1.4 percent, to $8,315 a metric ton at 11:26 a.m. on the London Metal Exchange. Copper for delivery in December added 1.3 percent to $3.7805 a pound on the Comex in New York. All of the six main metals traded on the LME gained, led by aluminum.

A weaker dollar fuels demand for commodities as an alternative investment and makes metals priced in the currency cheaper in terms of other monies. The U.S. Dollar Index, a six- currency gauge of the greenback’s strength, slid as much as 0.6 percent after falling for a second month in October. LME copper rose for a fourth month last month.

Fed Meeting

The U.S. currency slumped amid speculation that Federal Reserve officials may engage in another round of asset purchases, known as quantitative easing, in an effort to stoke the U.S. economy. Fed policy makers begin a two-day meeting tomorrow.

“With copper a leading risk asset, we expect price action to remain timid ahead of the Fed’s QE2 announcement and subsequently to trade in line with broader market sentiment,” Hussein Allidina, head of commodities research at Morgan Stanley in New York, said in a report today.

Hedge funds raised bullish bets on copper last week to the highest level since January, according to U.S. Commodity Futures Trading Commission data. Speculative long positions outnumbered short positions by 26,463 contracts on the Comex in the week ended Oct. 26. Net-long positions rose 1 percent from a week earlier.

Institute for Supply Management figures due today at 2 p.m. London time probably will show that manufacturing in the U.S. expanded at a slower pace in October, evidence of the cooling in the recovery that’s taken place since early 2010, economists said. The ISM’s manufacturing gauge slipped to 54 from 54.4, the median estimate in a Bloomberg News survey shows.

Construction Spending

Other reports may show consumer spending rose and construction spending fell. Construction accounts for about 25 percent of global copper demand, according to the Copper Development Association.

Copper also gained last week on speculation about a potential strike at Collahuasi, the world’s fourth-largest mine for the metal. Anglo American Plc and Xstrata Plc restarted wage talks with workers on Oct. 29. The mine is in Chile, the biggest copper-producing nation.

Tin for three-month delivery on the LME rose 1.2 percent to $25,900 a ton. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 53 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Lead gained 1.6 percent to $2,487 a ton and nickel climbed 1.3 percent to $23,297 a ton. Aluminum rose 2 percent to $2,390 a ton and zinc added 1.9 percent to $2,470 a ton.

http://www.bloomberg.com/news/2010-11-01/copper-rises-as-chinese-manufacturing-speeds-up-dollar-slumps-zinc-gains.html

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Zinc dropps, Copper Declines, Paring Fourth Monthly Advance, as the Dollar Strengthens
By Maria Kolesnikova - Oct 29, 2010 2:32 AM PT

Copper fell in London, paring a fourth monthly gain, as a stronger dollar eroded demand for industrial metals as an alternative investment.

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, rose as much as 0.5 percent. Still, it’s on course for a second monthly drop amid speculation that the Federal Reserve will announce further policy-loosening steps, or quantitative easing, next week. A report today may show stronger economic growth in the U.S., the second-biggest copper user.

“Markets are bracing themselves for the Fed meeting next week, which will shed light on the quantitative-easing program, and are still trading against the dollar,” said Andrey Kryuchenkov, an analyst at VTB Capital in London. “Most investors will also be looking for U.S. third-quarter GDP numbers due today.”

Copper for delivery in three months fell $170, or 2 percent, to $8,170 a metric ton at 10:05 a.m. on the London Metal Exchange. The contract is up 1.9 percent this month. Copper for delivery in December slid 1.9 percent to $3.717 a pound on the Comex in New York. Tin dropped the most since June on the LME.

A stronger dollar makes metals priced in the currency more expensive in terms of other monies. A fourth monthly advance for copper would be the longest winning streak since the four months through August 2009.

ETF Introductions

“The combination of a potential strike at Collahuasi and the launch of copper exchange-traded funds is adding to what it already a bullish outlook for copper,” said Dan Major, an analyst at RBS Global Banking & Markets in London. “Despite these fundamental factors, dollar strength will likely lead to further copper-price weakness.”

Workers at Anglo American Plc and Xstrata Plc’s Collahuasi copper mine, the world’s fourth-biggest, are prepared to continue wage negotiations after rejecting a company offer, union secretary Juan Antonio Barraza said yesterday. The mine is in Chile, the largest copper-producing nation.

BlackRock Inc., the world’s biggest money manager, plans to introduce an exchange-traded product backed by copper, according to an Oct. 26 filing with the U.S. Securities and Exchange Commission. JPMorgan Chase & Co. plans a similar ETP, according to an Oct. 22 SEC filing. ETF Securities Ltd. said Oct. 11 it aimed to start ETPs backed by six industrial metals.

U.S. Economy

A report due at 1:30 p.m. London time today may show that U.S. gross domestic product expanded at a 2 percent annual pace in the third quarter, up from a 1.7 percent rate in the prior three months, according to the median estimate of 83 economists surveyed by Bloomberg News. Figures scheduled for 2:55 p.m. release may show little change in consumer confidence.

Copper may fall in London next week as the dollar strengthens and demand slows in China, the world’s biggest consumer of the metal, a Bloomberg News survey showed.

LME copper stockpiles rose 0.1 percent to 368,500 tons today, daily exchange figures showed. Copper stockpiles monitored by the Shanghai Futures Exchange fell 184 tons on the week to 106,091 tons, the bourse said today.

Orders to draw copper from LME stocks, or canceled warrants, gained 2.7 percent to 30,050 tons.

Tin for three-month delivery on the LME dropped 3.6 percent to $25,300 a ton after sliding as much as 4.6 percent, the most since June 4. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 49 percent this year, leading gains on the LME, after production was disrupted in Indonesia and the Democratic Republic of Congo.

Zinc dropped 3.6 percent to $2,405 a ton after falling as much as 4.6 percent, the most since Sept. 9. Lead declined 3.2 percent to $2,426 a ton, nickel lost 1.5 percent to $22,764 a ton and aluminum slid 1 percent to $2,322.75 a ton.

http://www.bloomberg.com/news/2010-10-29/copper-declines-paring-fourth-monthly-advance-as-the-dollar-strengthens.html

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Zinc climbs .6%, Copper Rebounds on Dollar Drop, Possible Labor Dispute in Chile
By Glenys Sim - Oct 28, 2010 12:11 AM PT

Copper rebounded from a two-day drop as the dollar resumed a decline, and on concern that there may be supply disruptions at the world’s fourth-largest mine. Zinc and nickel also rose.

Copper for three-month delivery on the London Metal Exchange gained as much as 0.7 percent to $8,357 a metric ton and traded at $8,340 a ton at 3:06 p.m. in Singapore. February- delivery copper on the Shanghai Futures Exchange fell as much as 1 percent to 63,600 yuan ($9,512) a ton and closed at 64,020 yuan. The contract rose as high as 65,600 yuan yesterday, the highest price since April 2008.

Workers at Anglo American Plc and Xstrata Plc’s Collahuasi copper mine in Chile, the world’s largest copper producer, rejected a company wage offer in a vote yesterday, the union said. Workers are prepared to continue wage negotiations “if the company is willing to talk,” the union’s secretary Juan Antonio Barraza said.

“A strike in Chile is a short-term support for prices that are trading beyond their fundamentals,” Lu Shihua, an analyst at New Era Futures Co., said from Jiangsu today. “The dollar continues to drive day-to-day moves. However, we’re beginning to see demand destruction at these prices and we’ll get more demand falling off as we move into the seasonally weak consumption period.”

The dollar snapped a two-day winning streak against a six- currency basket including the euro on optimism that the global economic recovery remains intact. A European report today may show that confidence in the region’s outlook improved for a fifth consecutive month.

Aluminum climbed 0.5 percent to $2,334 a ton, zinc climbed 0.6 percent to $2,525 a ton, nickel gained 0.5 percent to $22,920 a ton and lead fell 0.2 percent to $2,538 a ton. Tin was little changed at $26,060 a ton.

http://www.bloomberg.com/news/2010-10-28/copper-rebounds-on-dollar-slump-possible-labor-dispute-at-collahuasi-mine.html

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Zinc falls, Copper Drops as Dollar Climbs, Investors Sell After Rally to 27-Month High
By Anna Stablum - Oct 27, 2010 5:27 AM PT

Copper fell in New York and London as the dollar strengthened and some investors sold the metal after a rally to the highest price in more than 27 months.

Prices reached $3.90 a pound, the highest level since July 7, 2008, in New York before dropping. Copper posted a fifth straight weekly advance in the week ended Oct. 15 as the U.S. Dollar Index, a six-currency gauge of the greenback’s strength, declined for a fifth week. The index rose as much as 0.6 percent today and was last up 0.3 percent.

“Copper followed the currencies initially,” said Randy North, a trader at RBC Capital Markets in New York. “But there appears to be a bit of profit-taking around now.”

December-delivery copper slid 8.75 cents, or 2.3 percent, to $3.7815 a pound at 8:18 a.m. on the Comex in New York. Copper for delivery in three months dropped 2.4 percent to $8,304 a metric ton on the London Metal Exchange. All of the six main metals traded on the LME retreated, led by zinc.

A stronger dollar makes metals priced in the currency more expensive in terms of other monies and stokes demand for commodities as an alternative investment. The U.S. currency’s five-week slide came amid speculation that the Federal Reserve may engage in more debt purchases, or quantitative easing, to revive the U.S. economy. Fed policy makers will meet Nov. 2-3.

Reports today may show increased orders for durable goods and higher sales of new houses in the U.S., the world’s second- largest copper user after China.

House Sales

Bookings for durable goods rose 2 percent in September, the most in five months, according to the median estimate in a Bloomberg News survey of economists. The figures are scheduled for release at 8:30 a.m. New York time. A separate report due 90 minutes later may show that sales of new houses rose last month to a 300,000 annual rate.

Construction accounts for about 25 percent of global demand for copper, according to the Copper Development Association.

“There has been mixed macro data recently, so it provides little guidance as market participants ponder over the size and format of more quantitative easing in the U.S.,” said Andrey Kryuchenkov, an analyst at VTB Capital in London.

In Chile, the world’s largest copper-producing nation, Anglo American Plc and Xstrata Plc’s Collahuasi unit may seek to extend wage talks to avert a strike at the fourth-biggest copper mine. Managers at the unit aim to continue talks into next month if workers reject a pay accord in an Oct. 27 vote, company spokeswoman Bernardita Fernandez said yesterday.

Inventories Swell

LME copper stockpiles rose 0.3 percent to 368,600 tons, exchange figures showed. Orders to draw copper from LME inventories fell 3.4 percent to 27,450 tons.

Zinc and lead for three-month delivery on the LME fell after rising for five days. Prices had gained after Shenzhen Zhongjin Lingnan Nonfemet Co., China’s third-largest zinc producer, suspended output at its biggest smelter of the metals on Oct. 21.

Zinc fell 3.1 percent to $2,535 a ton after sliding as much as 3.3 percent, the most since Oct. 7. Lead declined 1.8 percent to $2,546 a ton, erasing a climb as high as $2,619, the highest price since Jan. 11.

Tin lost 2.2 percent to $26,100 a ton. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 55 percent this year, leading gains on the LME, after production was disrupted in Indonesia and the Democratic Republic of Congo.

Aluminum slid 1.5 percent to $2,354 a ton. Global demand excluding China will probably expand 17 percent to 24 million tons this year, Norsk Hydro ASA, Europe’s third-largest producer of the lightweight metal, said today. It predicted a 1 million- ton global surplus.

Nickel dropped 1.7 percent to $22,900 a ton.

http://www.bloomberg.com/news/2010-10-27/copper-drops-as-dollar-climbs-before-u-s-durable-goods-housing-reports.html

[the cork]

Lead up 1%, Copper Climbs to 27-Month High; Zinc Gains to Nine-Month Peak
By Glenys Sim - Oct 25, 2010 7:09 PM PT

Copper advanced to the highest level in more than 27 months, gaining for a third day, as investors sought alternatives to a weakening dollar. Zinc rose to the highest price in nine months.

Copper for three-month delivery increased as much as 0.4 percent to $8,554 a metric ton on the London Metal Exchange, the highest level since July 2008, and traded at $8,548 a ton at 10:04 a.m. in Singapore. The metal used in construction and household appliances earlier fell as much as 0.5 percent.

“It’s all to do with the outlook for the economy and the dollar, and a kind of manic momentum that’s driven, and may most probably extend, the rally,” said Zhi Shiwei, an analyst at Yong’an Futures Co., said from Beijing. “Inflationary concerns are surfacing, which is bullish for commodities.”

The dollar was little changed after falling to a one-week low yesterday against a six-currency basket including the euro and yen, on speculation increased government bond purchases by the Federal Reserve may weaken the currency. Investors often buy raw materials as a hedge against a decline in the dollar’s value.

In Chile, the world’s largest copper producer, unions at Anglo American Plc and Xstrata Plc’s Collahuasi mining unit called on workers to reject the company’s latest wage offer, setting the stage for a possible strike at the world’s fourth- largest copper mine. Employees will vote tomorrow on the company’s new wage offer, the company said.

Zinc in London gained as much as 2.9 percent to $2,638.75 a ton, the highest price since January as investors bet that supply may lag behind demand after Shenzhen Zhongjin Lingnan Nonfemet Co., China’s third-largest zinc producer, suspended output at its biggest zinc and lead smelter. The metal also rose to a nine-month high in Shanghai.

Among other LME-trade metals, aluminum rose 0.6 percent to $2,387 a ton, lead gained 1 percent to $2,610 a ton, nickel climbed 0.5 percent to $23,690 a ton, and tin fell 0.2 percent to $26,850 a ton.

http://www.bloomberg.com/news/2010-10-26/copper-climbs-to-27-month-high-zinc-gains-to-nine-month-peak.html

[the cork]

Zinc gains, Copper Advances, Pares for First Weekly Drop in Six, as Dollar Retreats
By Glenys Sim - Oct 21, 2010 10:32 PM PT

Copper advanced, paring its first weekly drop in six weeks, as the dollar’s retreat increased the appeal of commodities as alternative investments. Zinc rose to a six-month high and lead traded near a nine-month high.

Copper for three-month delivery rose as much as 0.7 percent to $8,366 a metric ton on the London Metal Exchange and traded at $8,360.25 a ton at 1:14 p.m. in Singapore. The contract is down 0.5 percent this week as the dollar is poised to snap a five-week losing streak against a six-currency basket.

“The moves have all been dollar-related recently and will continue to be at least until the Fed meeting next month, as investors anticipate further easing measures,” Gan Huaiming, an analyst at China International Futures Co., said from Shanghai. “On the fundamentals front, high prices are causing demand destruction as physical buyers stay away from the market.”

December-delivery copper on the Comex in New York gained 0.7 percent to $3.808 a pound, heading for a 0.8 percent weekly loss. The metal for January delivery in Shanghai added 0.4 percent to 62,930 yuan ($9,454) a ton, down 1.5 percent this week, the most since the week ending Sept. 10.

The dollar headed for its first weekly gain since Sept. 10 against the euro amid speculation that Group of 20 finance chiefs will seek to refrain from weakening their currencies to support economic growth. G-20 policy makers are gathering today and tomorrow in Gyeongju, South Korea.

Lead, Zinc

Zinc gained as much as 1.9 percent to $2,520 a ton on the LME, the highest price since April, extending yesterday’s 1.4 percent advance after China’s third-largest zinc producer said it shut its biggest smelter. Futures in Shanghai surged as much as 4 percent, trading at more than 20,000 yuan a ton for the first time since January.

Shenzhen Zhongjin Lingnan Nonfemet Co. suspended output at its Shaoguan smelter in Guangdong after authorities found that excessive levels of thallium were discharged by the plant into a river. Operations were halted from yesterday, the company said in a statement to the Shenzhen Stock Exchange last night.

Lead in London added as much as 1.2 percent to $2,513.75 a ton, after reaching $2,514 yesterday, the highest level since January. Zinc and lead are the worst-performing metals on the LME this year. Zinc is used to galvanize steel while lead is used in batteries.

“The jump in prices is just a knee-jerk reaction to the news and it’s providing temporary support to prices, which haven’t done so well this year,” said Wang Zhouyi, deputy manager of China International Futures (Shanghai) Co.’s research department.

Aluminum in London rose 0.8 percent to $2,369 a ton, tin climbed 0.4 percent to $26,550 a ton, while nickel gained 0.4 percent to $23,640 at 1:23 p.m. in Singapore.

http://www.bloomberg.com/news/2010-10-22/copper-in-london-heads-for-first-weekly-drop-in-six-on-rebounding-dollar.html

[the cork]

It's a good one Huntewr7. I wanted to have Farallon in my portfolio because it covered so many metals within one security.

I think what ever "guidance" has been issued (.70) can be thrown out the window in a weakening currency environment.

Zinc and Copper are the main drivers for the stock price. Gold and Silver are just more or less go along for the ride, and where a "hidden" value lies.

If you can catch it on a pull back in in Zinc, you should be able to realize a little bit of a cushion.

[the cork]

Zinc gains, Copper Declines in London as China's Economic Growth Slows: LME Preview
By Glenys Sim - Oct 21, 2010 1:03 AM PT

Oct. 18 (Bloomberg) -- Gavin Wendt, a director at Mine Life Resources Ltd. in Sydney, talks about his investment strategy for gold, copper and crude oil. Wendt also discusses BHP Billiton Ltd. and Rio Tinto Group abandoning a plan to create the world’s largest iron-ore exporter after opposition from regulators in Europe and Asia. He speaks to Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

Copper dropped as China’s economy grew at the slowest pace in a year in the third quarter and the dollar rebounded. Zinc gained to a six-month high.

The metal for three-month delivery fell as much as 0.8 percent to $8,272.50 a metric ton, and traded at $8,305 a ton at 3:35 p.m. in Singapore. Copper rebounded from a one-week low yesterday as the dollar slumped by the most in three-and-a-half months against a six-currency basket. It reached a 27-month high of $8,492 a ton on Oct. 19.

Economic growth in China, the largest metals user, was 9.6 percent in the third quarter, the statistics bureau said today, the smallest gain in a year. Consumer prices rose 3.6 percent, matching the median forecast of economists surveyed by Bloomberg.

“China’s economic data didn’t surprise anyone and investors are just taking the opportunity to take profit,” Lin Ling, an analyst at Industrial Futures Co., said from Shanghai. “The world is still awash with liquidity and that’s going to keep driving prices higher as investors look for places to put their money.”

China’s interest rate increase two days ago, the first since 2007, highlighted the government’s confidence in the nation’s recovery and concern at asset-bubble and inflation risks. The rate hike may not curb gains in metal prices, and is unlikely to restrain demand, traders and analysts said yesterday.

December-delivery copper on the Comex in New York lost as much as 0.7 percent to $3.7665 a pound, while the metal for January delivery in Shanghai was little changed at 62,690 yuan ($9,433) a ton, after rising as much as 0.8 percent earlier.

‘Temporary Pullbacks’

“After the steep rally, commodities are vulnerable for temporary pullbacks,” Tobias Merath, head of commodity research at Credit Suisse AG, wrote in a note yesterday. The bank expects copper to trade between $8,400 and $8,600 at the end of the year, up from an earlier estimate of $7,800-$8,000. It also increased its end-2011 forecast to $8,800-$8,900 from $8,500-$8,700 a ton.

Copper, used in construction and household appliances, is up 8 percent in the past month as the Dollar Index declined 4 percent against six major currencies including the euro and yen. The dollar fell against the euro before a report forecast to show a gauge of leading indicators failed to accelerate last month.

The dollar has come under “significant pressure” as markets expect the Federal Reserve to resume asset purchases and “this environment is directing strong investment flows into commodity markets,” said Merath.

Copper demand exceeded supply by 161,000 tons in the first eight months of the year, compared with a surplus of 16,000 tons a year earlier, the World Bureau of Metal Statistics said yesterday. Stockpiles tallied by the London Metal Exchange have fallen 26 percent this year.

Zinc Gains

Zinc gained as much as 1.2 percent to $2,468 a ton, the highest price since April, on speculation Shenzhen Zhongjin Lingnan Nonfemet Co., China’s third-largest producer of the metal, halted production at its smelter in Guangdong province. Trading of Zhongjin shares was suspended today pending a company announcement.

“There is talk that the company has stopped production at its Shaoguan smelter because of an environmental issue and about 250,000 tons of capacity has been affected,” said Huang Jianyun, an analyst at Maike Futures Co.

Aluminum in London fell 0.3 percent to $2,354 a ton, lead climbed 0.6 percent to $2,464.50 a ton, and nickel lost 0.6 percent to $23,800 a ton. Tin gained 0.3 percent to $26,825 a ton at 3:39 p.m. in Singapore.

http://www.bloomberg.com/news/2010-10-21/copper-in-london-declines-as-china-economic-growth-slows-dollar-rebounds.html

[Huntewr7]

Sure need to find some powder before this one runs away from me. The new discoveries should add to the overall production values and mine life.

[the cork]

Farallon Announces Discovery Of New Zone At G-9

6 Metres of 15% Zinc and 20 Metres of 7.6% Zinc included in new zone
Other promising intercepts made to the East of current mine workings

October 20, 2010, Vancouver, BC - Farallon Mining Ltd. ("Farallon" or the "Company") (TSX:FAN) announces the discovery of a new zone of zinc rich, polymetallic, sulphides at its G-9 mine in Guerrero State, Mexico. The new zone, which has been confirmed by several drill holes, drilled from underground, is both significant for its size and location. This discovery is the result of an extensive underground drill program designed to specifically target nearby areas for new discoveries, in line with traditional polymetallic deposit formational geology and consistent with the Company's business model.

A table of intercepts is attached, along with various maps and sections to illustrate the relative location of the new zone to current mine workings. The zone is up to 30 metres thick and is 100 metres in length and is open in two directions - east and west. It is 60 metres below the current mine workings in the West Extension and North zones (more specifically, mining Area 7). The current estimate of the volume outlined by drilling so far is approximately 200,000 cubic metres. Highlights of intersections within this volume include 6 metres of 14.9% zinc and 20 metres of 7.6% zinc, showing that the new zone has both the potential for excellent grade and significant volume.

Additionally, a new lens has been discovered to the east of the Southeast zone and beyond current mine workings. This lens has also been confirmed by several underground drill holes and is open to the east, with grades increasing as drilling progresses further to the east. The lens is also at a lower stratigraphic horizon from the Southeast zone and includes intercepts of 3.2 metres of 16.2% zinc and 2.5% copper.

Dick Whittington, President and CEO, stated "These discoveries are exciting in two ways. First, they confirm the basis for the Company's business model - that we will continue to discover new zones of mineralization adjacent to current G-9 mine workings - which is so typical of polymetallic deposits being mined worldwide. Second, and more significantly, for the continued success of this thesis, both discoveries are at lower stratigraphic levels in the local felsic horizons at G-9. This is the first time that we have encountered mineralization at depths below current G-9 mine workings, and it opens up the possibility for more discoveries at this lower stratigraphic horizon. The Company will be aggressively pursuing both these discoveries to incorporate them into the resource base by year-end."

Dan Kilby, P.Eng., is the qualified person for Farallon Mining and he has reviewed and approved this news release. Sample preparation for Acme Labs is done in Guadalajara, Mexico and the analysis is done in Vancouver B.C. Samples analyzed by Acme Labs are assayed for gold by fire assay fusion with an ICP or gravimetric finish, with the latter method used for additional assays if ICP analysis reports grades higher than 10 g/t Au. Silver, copper, lead and zinc, as well as 20 additional elements, are determined for all samples by Agua Regia digestion followed by ICP-ES finish. In the case of silver, re-analysis using gravimetric finish is carried out when ICP-ES analysis reports a grade higher than 300 g/t Ag. In the case of lead and zinc, re-analyses using 0.1 gram splits are carried out if the ICP-ES results report grades higher than 4% Pb and 20% Zn. Re-analyses for copper are not required, due to the linear nature of ICP-ES assay returns over a wide value range that far exceeds the range of copper grades at G-9. If ICP-ES analysis reports zinc grades higher than 10% Zn, the samples are assayed for sulphur, by LECO furnace. Samples analyzed at the on-site laboratory are assayed for silver, copper, lead and zinc by Agua Regia digestion followed by an AA finish. In the case of silver, a second round of Aqua Regia digestion, followed by an AA finish, is carried out when primary analysis reports a grade higher than 300 g/t Ag. Multi-element analyses and gold assays are not currently carried out.

Farallon operates the G-9 zinc mine on its Campo Morado Property in Guerrero State, Mexico. G-9 is a 1,500 tonnes per day, underground zinc mine with important by-product credits of copper, gold, and silver. G-9 has total cash costs1 in the lowest 10% of zinc producers worldwide. The Company is targeting production at an annualized rate of 120 million pounds of zinc and 15 million pounds of copper per year.

For further details on Farallon, please visit the Company's website at www.farallonmining.com or contact Neil MacRae, Investor Relations Manager, at [phone] or within North America at 1-877-688-2050.

ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington, President & CEO


http://www.farallonresources.com/fan/NewsReleases.asp?ReportID=424047&_Type=&_Title=Farallon-Announces-Discovery-Of-New-Zone-At-G-9

[the cork]

Zinc advances, Copper May Rebound From Biggest Decline Since July as the Dollar Weakens
By Anna Stablum - Oct 20, 2010 5:01 AM PT

Copper may gain in New York and London, rebounding from the biggest drop in three months, as the dollar weakens.

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, fell as much as 0.7 percent. December- delivery copper slid 2.5 percent yesterday on the Comex in New York, the most since July 16, after China, the world’s biggest consumer of the metal, raised interest rates. The increase will have scant effect on metals, traders and analysts said today.

“It looks like the knee-jerk reaction to the China rate hike is over and the market has had time to absorb the implications,” said Alex Heath, head of industrial-metals trading at Royal Bank of Canada Europe Ltd. in London. “The key again will be the dollar.”

December-delivery copper gained 1 cent, or 0.3 percent, to $3.7675 a pound at 7:50 a.m. on the Comex. Copper for delivery in three months climbed 0.1 percent to $8,270 a metric ton on the London Metal Exchange.

China unexpectedly raised borrowing costs for the first time since 2007, lifting the benchmark one-year lending rate and the deposit rate by 0.25 percentage point.

The increase “is being seen as a vote of confidence in the resilience of the Chinese economy and should not derail it or impact levels of base-metal consumption for the longer term,” Heath said.

Asset Bubbles

The higher rates extend measures taken this year to rein in record loan growth and asset bubbles in the world’s fastest- growing economy, including curbing loans for third-home purchases and raising mortgage rates. Concern about the effect of steps aimed at slowing growth contributed to LME copper’s 16 percent drop in the second quarter.

“Surprise macro policy shifts like this, aimed at taking the wind out of economic and speculative trade activity, have only a brief impact on markets,” Tom Price, an analyst at UBS AG in Sydney, said in a report e-mailed today.

The dollar index slid before the Federal Reserve releases its Beige Book regional business survey, which may show a slowing U.S. economic recovery, at 2 p.m. in Washington. A weaker U.S. currency makes dollar-priced commodities cheaper in terms of other monies and spurs demand for raw materials as an alternative investment.

27-Month High

Speculation that the Fed may signal further measures to ease credit probably will support metals, along with “all the consumer/speculative commodity buying that accompanies this plus seasonal restocking,” UBS’s Price said.

Copper yesterday touched $8,492 a ton, the highest intraday price since July 7, 2008, on the LME. Today it slid as low as $8,170, the lowest level since Oct. 12.

LME copper stockpiles gained 0.2 percent to 370,750 tons, exchange figures showed. Orders to draw copper from LME inventories, or canceled warrants, jumped 14 percent to 25,350 tons.

Tin for three-month delivery on the LME rose 2.1 percent to $26,450 a ton. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 56 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Canceled warrants for tin more than doubled to 455 tons, according to the LME. Exchange inventories of the metal rose 1.8 percent to 12,690 tons.

Nickel was unchanged at $23,475 a ton. Cash nickel’s discount to the three-month contract yesterday swelled to $69 a ton, the widest level since Aug. 18, from $59 in the prior session, according to LME data. Cash metal closed at a $4 premium on Oct. 1. LME stockpiles of nickel have gained 1.6 percent this month to today’s 124,572 tons.

Aluminum was little changed at $2,356 a ton, lead gained 0.6 percent to $2,414 a ton and zinc advanced 0.8 percent to $2,415 a ton.

http://www.bloomberg.com/news/2010-10-20/copper-may-rebound-from-biggest-decline-since-july-as-the-dollar-weakens.html

[the cork]

Zinc slips, Copper Slumps in New York After China, Biggest User, Raises Interest Rates
By Anna Stablum - Oct 19, 2010 5:34 AM PT

Copper slumped in New York and London as China, the biggest consumer of the metal, increased its lending and deposit rates after inflation accelerated.

China last raised benchmark rates in December 2007. China’s inflation quickened to 3.5 percent in August, the fastest pace in 22 months. Other industrial metals also retreated and the U.S. Dollar Index, a six-currency gauge, jumped as much as 1.1 percent. A stronger dollar increases the cost of dollar- denominated commodities for investors holding other monies.

Higher Chinese rates “suggests that the authorities are keen to ensure that inflation does not rise further,” said David Thurtell, an analyst at Citigroup Inc. in London.

Copper for December delivery fell 9.35 cents, or 2.4 percent, to $3.7615 a pound at 8:18 a.m. on the Comex in New York. Copper for delivery in three months dropped 1.7 percent to $8,300.75 a metric ton on the London Metal Exchange.

LME-traded copper rose 3.7 percent this month as the dollar weakened on expectations U.S. policy makers will cut borrowing costs to zero by January. Federal Reserve policy makers next meet Nov. 2-3.

“This could represent the first move in a new approach from the Chinese authorities,” said Nic Brown, an analyst at Natixis Commodity Markets Ltd. in London. “If the Fed is to go ahead with more quantitative easing, China may have decided that simply raising minimum reserve ratios isn’t enough anymore.”

Commodities will rally if the Fed eases monetary policy next month, according to UBS AG, which describes a likely second round of quantitative easing as a “game changer” for copper.

Largest Economy

The additional measures to boost the world’s largest economy will increase capital flows to emerging markets, reinforcing commodity-intensive growth, the Swiss bank said in a note to clients today that summarized a commentary from Oct. 18.

In the U.S., housing starts rose 0.3 percent to a 610,000 annual rate, the most since April, Commerce Department figures showed today in Washington. Building permits dropped to the lowest level in more than a year.

Tin for three-month delivery on the LME fell 1.7 percent to $26,200 a ton. Prices reached a record $27,338.50 on Oct. 14. The metal has jumped 56 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Aluminum slid 1.4 percent to $2,376.25 a ton and nickel fell 1.3 percent at $23,500 a ton. Lead dropped 1.2 percent to $2,408.50 a ton and zinc lost 0.7 percent to $2,408.50 a ton.

http://www.bloomberg.com/news/2010-10-19/copper-falls-in-london-as-dollar-rebounds-china-increases-interest-rates.html

[the cork]

Zinc falls, Copper Declines in London as Dollar Strengthens, China Inventories Expand
By Glenys Sim - Oct 18, 2010 1:11 AM PT

Copper declined along with other industrial metals as the dollar rose and high prices deterred purchases by Chinese users amid rising domestic stockpiles.

Futures for delivery in three months on the London Metal Exchange dropped as much as 1.2 percent to $8,297 a metric ton and traded at $8,300 at 4:05 p.m. in Singapore. Copper reached $8,490 a ton on Oct. 14, the highest level in 27 months.

“Metals trading will be driven by what happens to the dollar,” Xie Xiaoming, an analyst at Sheng Da Futures Co., said from Guangdong. “Rising domestic stockpiles are an indication that consumers are unwilling to buy at these high prices.”

The December-delivery contract on the Comex in New York fell as much as 1.6 percent to $3.779 a pound, before trading at $3.7805 a pound. Copper for January delivery in Shanghai lost as much as 1.5 percent to 62,960 yuan ($9,475) a ton.

Copper stockpiles tallied by the Shanghai Futures Exchange gained for a second week to a six-week high of 103,510 tons last week, according to data provided by the bourse. That’s the highest level since the week ended Sept. 3.

The metal, used in construction and household appliances, has risen 7.8 percent in the past month as the dollar lost 4.9 percent against a basket of six major currencies. The U.S. currency rose for a second day against the euro before a German report tomorrow that may show investor confidence fell to a 21- month low in October.

‘Positive Momentum’

“We don’t debate that the market has plenty of positive momentum,” HSBC Holdings Plc analysts led by Andrew Keen wrote in an Oct. 17 report. “But the problem from an investment viewpoint is that it is a consensus trade and we would argue that copper’s good prospects are already in the price of both the metal and the equities.”

HSBC expects copper to average $3.27 a pound, or $7,200 a ton in 2011. Prices in London have averaged $7,263.73 this year.

“We identify three downside risks to copper: demand destruction at $4 a pound, disruption rates that could already be double-counted in conservative production estimates, and that the starting balance in the copper market might not be the huge deficit that consensus appears to believe,” Keen wrote.

Zinc in London fell 1.6 percent to $2,383.75 a ton, lead lost 1.7 percent to $2,385 a ton and nickel dropped 2.7 percent to $23,410 a ton. Aluminum decreased 0.4 percent to $2,368 a ton and tin declined 2.2 percent to $26,150 a ton.

http://www.bloomberg.com/news/2010-10-18/copper-leads-decline-in-metals-as-dollar-rallies-china-inventories-grow.html

[the cork]

Zinc rose, Copper Climbs for a Fourth Day in London on Demand Prospects: LME Preview
By Maria Kolesnikova - Oct 15, 2010 12:01 AM PT

Copper climbed for a fourth day in London as the outlook for demand improved. Lead and nickel also gained. Relative
Strength Index 72.7.

-- Copper rose $24.50, or 0.3 percent, to $8,424.50 a metric ton

-- Aluminum gained 0.2 percent to $2,419 a ton. RSI 67.
-- Zinc rose 0.8 percent to $2,433.5 a ton. RSI 70.5.
-- Lead gained 0.7 percent to $2,428.5 a ton. RSI 66.1.
-- Nickel rose 0.9 percent to $24,520 a ton. RSI 63.1.
-- Tin fell 0.5 percent to $26,805 a ton. RSI 75.2.

Other markets: Last % Change % YTD
U.S. Dollar Index 76.530 -0.1 -1.7
Crude oil $82.87 0.2 4.4
Gold $1,380.45 -0.1 25.8
MSCI World Index 1,224.48 -0.1 4.8

Economic Events:
Forecast Prior Time
(London)

Euro-zone CPI (MoM) 0.2% 0.2% 10:00
U.S. consumer price index (MoM) 0.2% 0.3% 13:30
U.S. University of Michigan
survey of consumer confidence 68.9 68.2 14:55

To contact the reporter on this story: Maria Kolesnikova in Moscow at [e-mail].

http://www.bloomberg.com/news/2010-10-15/copper-climbs-for-a-fourth-day-in-london-on-demand-prospects-lme-preview.html

[the cork]

Zinc up .6%, Copper Climbs to a 27-Month High as Dollar's Slump Stokes Fed Speculation
By Maria Kolesnikova - Oct 14, 2010 5:10 AM PT

Copper rose to a 27-month high in New York and London as the dollar slumped before reports likely to fuel speculation that the Federal Reserve will ease monetary policy further to stoke economic growth.

The dollar fell to a 15-year low versus the yen and touched the lowest level since January against the euro amid expectations of further quantitative easing, or asset purchases by the Fed. A weaker dollar makes metals priced in the currency cheaper in terms of other monies and fuels demand for commodities as an alternative investment.

“All of the markets are being driven by the dollar,” said Nic Brown, an analyst at Natixis in London. “As renewed quantitative easing by the Fed appears increasingly likely, this is impacting directly upon currency markets, and metals are reacting in line with this, led by gold.”

Copper for delivery in December added 2 cents, or 0.5 percent, to $3.8405 a pound at 7:45 a.m. on the Comex in New York. The contract touched $3.8675, the highest price since July 2008. Copper for delivery in three months advanced 0.8 percent to $8,430 a metric ton on the London Metal Exchange and tin reached a record.

Gold for immediate delivery gained as much as 1.1 percent to an all-time high of $1,387.35 an ounce in London. Raw materials from rice to crude oil rose.

Trade Gap

Figures due at 8:30 a.m. New York time may show slower gains in U.S. wholesale costs last month, while the trade deficit probably widened in August as imports stabilized following their biggest drop in more than a year, economists said. A report due tomorrow may show a weaker increase in U.S. consumer prices.

Fed Chairman Ben S. Bernanke will speak tomorrow on monetary-policy objectives and tools in Boston. He said on Oct. 4 that the central bank’s first round of large-scale asset purchases aided the economy and that further quantitative easing is likely to help more.

Copper will average $8,438 a ton next year, compared with $7,344 in 2010, Fred Demler, head of global commodities at MF Global, said at a seminar in London yesterday. The world is entering “a generally strong period for all commodities,” and copper, aluminum, zinc and nickel will rise in 2011’s first quarter, he said.

No “real whoppers” of new copper mines are being planned, and mine capacity growth probably will continue to “fall short,” BNP Paribas SA analyst Stephen Briggs said yesterday in a presentation.

‘Robust’ Fundamentals

“There is no big project coming to the market, and people are waking up to the fact,” Marc Elliott, an analyst at Fairfax IS in London, said today by telephone. “Where is it all going to come from? Long-term fundamentals remain very robust.”

LME copper stockpiles rose 0.1 percent to 371,500 tons, daily exchange figures showed. They have shrunk 0.7 percent so far in the fourth quarter after dropping by 27 percent in the prior six months.

“LME inventories are pulling back slightly, so that’s a fairly encouraging signal,” Elliott said. “And we are entering a seasonally stronger consuming period, particularly in China, which is the world’s largest consumer.”

Orders to draw copper from LME stocks, or canceled warrants, fell 2.1 percent to 23,850 tons.

Tin, Aluminum

Tin for three-month delivery on the LME rose 1.8 percent to $27,250 a ton after touching $27,300. The metal has jumped 61 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Aluminum added 1 percent to $2,440 a ton. LME stocks shrank for a 21st day to 4.32 million tons. The streak of declines is the longest since March 14, 2005.

Cash aluminum’s discount to the three-month contract swelled yesterday to $36.25 a ton, the widest level since Dec. 29. Spot metal was at a premium of $2.25 to the three-month contract on Aug. 24.

Lead fell 0.2 percent to $2,430 a ton after touching $2,473, the highest intraday price since Jan. 19. Nickel dropped 0.1 percent to $24,375 a ton and zinc rose 0.6 percent to $

http://www.bloomberg.com/news/2010-10-14/copper-rises-to-27-month-high-climbing-for-a-third-day-as-dollar-slumps.html

[the cork]

Zinc up 1.3%, Copper Gains to 27-Month High in London on Weaker Dollar, Improving Demand
By Glenys Sim - Oct 13, 2010 12:35 AM PT

Copper climbed to 27-month highs in London and New York as demand prospects improved and as the dollar declined. Lead gained to the highest level in six months.

Three-month copper on the London Metal Exchange rose as much as 0.8 percent to $8,415 a metric ton, the highest level since July 2008, and was at $8,389.25 at 3:19 p.m. in Singapore. The December-delivery contract on the Comex in New York gained as much as 1.3 percent to $3.8385 a pound, also the highest price since July 2008.

Chile’s Codelco, the world’s biggest copper producer, expects a “tighter” market next year because of demand from China and a lack of new supply, Chief Executive Officer Diego Hernandez said yesterday.

“There’s no stopping the bullishness in the market right now and there’s this frantic buying into commodities as the dollar continues to weaken,” Huang Wei, an analyst at Jicheng Futures Co., said from Guangdong. “The fundamentals are definitely improving, especially for copper. However, they aren’t so good as to justify the current prices.”

January-delivery copper on the Shanghai Futures Exchange gained as much as 1.8 percent to 63,350 yuan ($9,501) a ton. China is the world’s largest metals user.

The metal in London has risen 9.7 percent in the past month as the dollar tumbled 5.8 percent against a six-currency basket on increasing speculation the Federal Reserve will take further measures to protect the economic recovery. Copper inventories monitored by the LME, down 26 percent this year, are at their lowest level in a year.

Fed Minutes

In the minutes of their September meeting, Fed policy makers said they were prepared to ease monetary policy “before long” and focused on purchases of Treasury securities and boosting inflation expectations. The minutes of the meeting were released yesterday.

“The market is quite tight and next year it should continue to be tight,” Hernandez said in an interview. China “has kept quite firm demand,” he said.

On the supply side, a deterioration of the quality of ore and lack of investments in mines, exacerbated by the financial crisis in 2008, will keep prices at current levels “for a while,” said Hernandez. The long-term price of copper may be about $2.30 a pound, he said.

Copper prices may average more than $8,000 a ton in the fourth quarter of this year, 10 percent higher than the $7,266.78 average in the third quarter, according to a state purchasing agency in South Korea, Asia’s third-biggest base metals buyer.

“Despite a fast pace in the global economic recovery this year, supply growth for copper seems to have been very slow,” Lee said. “The metal is likely to advance to higher levels on slowing supply growth amid excessive liquidity in global markets.”

China’s Imports

China’s copper imports dropped for the first time in three months to 368,410 tons in September from 379,527 tons in August, as lower domestic prices reduced the appeal of overseas purchases. The country also imported 410,000 tons of scrap copper, up 2.5 percent from 400,000 tons in August, the General Administration of Customs said on its website today.

Higher scrap imports and the shutting of a smelter in India helped to reduce the demand for refined metal and ease the supply shortage in the concentrates market, according to Shenzhen Rongtuo Trading Co. Concentrate is semi-processed ore.

This led to a jump in processing fees, paid by miners to smelters to turn ore into refined metal, to as high as $80 a ton for smelting and 8 cents a pound for refining, up from about $20 to $30 a ton a month ago, said China International Futures (Shanghai) Co. analyst Fang Junfeng.

Zinc in London rose as much as 1.3 percent to $2,399.75 a ton, and lead gained as much as 1.2 percent to $2,403.50 a ton, both the highest levels since April. Nickel climbed 1.4 percent to $24,385 a ton, aluminum was little changed at $2,434.75 a ton, while tin dropped 0.8 percent to $26,300 a ton.

http://www.bloomberg.com/news/2010-10-13/copper-gains-to-27-month-high-in-london-on-weaker-dollar-improving-demand.html

[the cork]

Zinc gains, Copper Declines in New York on Stronger Dollar, Chinese Credit Tightening
By Maria Kolesnikova - Oct 12, 2010 5:22 AM PT

Copper fell in New York after the dollar strengthened and China, the world’s biggest user of the metal, moved to curb bank lending to cool its economy.

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, added as much as 0.6 percent. China’s central bank raised reserve requirements for six banks for a two-month period, three people with knowledge of the matter said.

“The currency is still the dominant driver in the market today,” said Daniel Major, an analyst at RBS Global Banking & Markets in London.

Copper for delivery in December dropped 2 cents, or 0.5 percent, to $3.7695 a pound at 8:09 a.m. on the Comex in New York. Prices yesterday touched the highest level since July 8, 2008. Copper for delivery in three months slipped 0.1 percent to $8,283 a metric ton on the London Metal Exchange.

Prices rebounded from today’s lowest levels as the dollar index, last up 0.3 percent, pared gains. A stronger U.S. currency makes dollar-priced metals more expensive in terms of other monies and saps demand for commodities as an alternative investment.

Comex copper’s 14-day relative strength index, a gauge of whether a commodity is overbought or oversold, was at 67.5 after last week rising above 72. Some analysts and traders who study technical charts view readings above 70 as a sign that prices may be poised to fall.

‘Overextended’ Prices

“Prices are just looking a little overextended after the recent gains,” RBS’s Major said. Copper may drop for three to four weeks after this week, he said.

China has moved this year to restrain economic growth in response to concern about potential inflation. Officials in April ordered developers not to take deposits for sales of uncompleted apartments without proper approval and clamped down on loans for third-home purchases to cool rising prices.

While the increased reserve requirement is “hardly surprising,” such steps “affect sentiment more than anything,” said Andrey Kryuchenkov, an analyst at VTB Capital in London. Copper “still looks strong,” he said.

Copper consumption will outpace supply this year by 58,000 tons as demand increases and supplies are disrupted, Standard Bank Plc said. Until now, it predicted a surplus.

LME copper stockpiles fell 0.2 percent to 371,750 tons, daily exchange figures showed. Orders to draw copper from LME stocks, or canceled warrants, slid 2.8 percent to 24,600 tons.

Tin, Aluminum

Tin for three-month delivery on the LME rose 1 percent to $26,450 a ton. Prices touched a record $26,790 on Oct. 6. The metal has jumped 56 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

PT Timah, the world’s largest tin exporter, may miss a production target this year because of heavy rains and the Indonesian company is trying to renegotiate supplies with long- term customers. Timah may produce 40,000 tons, compared with a goal of 45,000 tons, Corporate Secretary Abrun Abubakar said in an interview.

Aluminum rose 0.9 percent to $2,422 a ton. Demand may outpace production by 700,000 tons next year as usage in China increases and exchange-traded products take metal away from the market, according to research group Harbor Intelligence.

Nickel dropped 0.7 percent to $24,150 a ton, lead was unchanged at 2,315 a ton and zinc gained 0.3 percent to $2,336 a ton.

http://www.bloomberg.com/news/2010-10-12/copper-drops-for-second-day-as-china-tightens-credit-dollar-strengthens.html

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Zinc rises, Copper May Advance as Speculation About Fed Policy Weighs on the Dollar
By Maria Kolesnikova - Oct 11, 2010 5:34 AM PT

Copper may rise in New York and London as speculation that Federal Reserve officials will this week signal their readiness to buy more government debt to support economic growth weighs on the dollar.

The U.S. currency traded near an eight-month low against the euro and touched a 15-year low versus the yen before tomorrow’s release of minutes from the Fed’s Sept. 21 policy meeting. A weaker dollar makes metals priced in the currency cheaper in terms of other monies and fuels demand for raw materials as an alternative investment.

“The rising supply of dollars in the system will increase demand for hard assets like commodities and precious metals as a store of value,” said Prasad Patkar, who helps manage about $1.8 billion at Platypus Asset Management in Sydney.

Copper for delivery in December rose 1.25 cents, or 0.3 percent, to $3.787 a pound at 8:10 a.m. on the Comex in New York. Prices touched $3.82, the highest level since July 8, 2008. Copper for delivery in three months added 0.1 percent to $8,317 a metric ton on the London Metal Exchange.

Fed speculation intensified on Oct. 8 as government figures showed that U.S. payrolls fell by 95,000 workers in September, more than the drop of 5,000 estimated by analysts surveyed by Bloomberg. The Dow Jones Industrial Average of U.S. equities closed above 11,000 points.

IMF Meeting

Exchange rates dominated the International Monetary Fund’s annual meeting in Washington amid concern that nations are relying on cheaper currencies to aid growth, risking trade wars. China was accused of undervaluing the yuan, while low interest rates in the U.S. and other rich nations were blamed for flooding emerging markets with capital.

“We expect further gains in base-metal prices, especially copper and tin, as the outcome from the recent IMF meeting and last week’s U.S. jobless-claims number confirm the market’s expectations of renewed quantitative easing in the U.S. and Japan,” Hussein Allidina, head of commodities research at Morgan Stanley in New York, said in a report today.

Hedge funds raised bullish bets on copper futures to the highest level since Feb. 1, according to U.S. Commodity Futures Trading Commission data.

Speculative long positions, or bets prices will rise, outnumbered short positions by 24,399 contracts on the Comex in the week ended Oct. 5, the commission said in its Commitments of Traders report on Oct. 8. Net-long positions rose by 2,237 contracts, or 10 percent from a week earlier.

Exchange-Traded Funds

ETF Securities Ltd., manager of $22 billion in assets, said it’s preparing to introduce exchange-traded commodities funds backed by copper, aluminum, nickel, lead, zinc and tin. No date has been set for trading to start, spokeswoman Noreen Shah said.

“The big question on everyone’s lips is whether there will be an official exchange-traded fund launch announcement this week in one of the metals,” RBC Capital Markets said in a report today.

Aluminum is most likely to be the first industrial metal to trade via an ETF, while tin is least likely to back a product because it has the smallest inventories, according to a Bloomberg survey of analysts.

LME copper stockpiles rose 0.1 percent today to 372,475 tons, daily exchange figures showed. They fell last week for a 33rd week in a row. Copper stockpiles in Shanghai rose by the most in almost six months, the Shanghai Futures Exchange said Oct. 8.

Orders to draw copper from LME stocks, or canceled warrants, rose 11 percent to 25,300 tons. They have surged 55 percent in three sessions.

Tin for three-month delivery on the LME fell 0.4 percent to $26,250 a ton. Prices touched a record $26,790 on Oct. 6. The metal has jumped 55 percent this year, leading advances on the LME, after production was disrupted in Indonesia and the Democratic Republic of the Congo.

Nickel climbed 0.3 percent to $24,475 a ton, while aluminum gained 0.1 percent to $2,423 a ton. Lead added 1.2 percent to $2,300 a ton and zinc rose 1.8 percent to $2,331 a ton.

http://www.bloomberg.com/news/2010-10-11/copper-may-advance-as-dollar-trades-near-eight-month-low-against-the-euro.html

[the cork]

Good deal Huntewr7. Great company, excellent production, good poly metallic mix. This is one of the best miners I have ever found.

Gets lonely around here sometimes LoL!

[Huntewr7]

If things go to plan will take a position here this week.

[the cork]

Zinc little changed but Copper Rallies, Heads for Weekly Gain, as Shanghai Advances After Holiday
By Glenys Sim - Oct 7, 2010 9:50 PM PT

Copper rebounded, on pace for its longest winning streak in nine months, as the dollar declined and investors in China bought the metal after London Metal Exchange prices advanced during the country’s week-long National Day holiday. Lead and nickel gained.

Three-month delivery copper added as much as 0.8 percent to $8,165 a metric ton, after losing as much as 0.7 percent earlier. Futures reached a 27-month high of $8,326 on Oct. 6 and traded at $8,146 by 11:20 a.m. Singapore time, up by 0.5 percent this week. Prices have risen for a fourth week, the longest period of advance since the four weeks ending Jan. 8.

“The weakness in the dollar is definitely aiding the rally in metals prices,” Pan Jinghua, an analyst at Citic Futures Co., said from Shanghai. “Fundamentally we’re moving into the peak demand season and this should help sustain the rally.”

Copper in London advanced 1.1 percent from Oct. 1-7 as the dollar slid on prospects for a further easing of monetary policy by the Federal Reserve to bolster the economy. It fell against a six-currency basket including the euro and yen on speculation the U.S. central bank will debase the dollar by stepping up purchases of government debt to support the economic recovery.

January-delivery copper on the Shanghai Futures Exchange rose as much as 1.4 percent to 61,450 yuan ($9,211) a ton, the highest level since April 16, and was at 61,040 yuan at the midday break. China’s financial markets re-opened today.

“The gap between London and Shanghai got too large in the past week,” Jia Zheng, a trader at Soochow Futures Co., said from Shanghai. “If Chinese investors try to play catch-up in Shanghai, it may help support London prices.”

China Property

Copper in Shanghai declined as much as 1.1 percent earlier after Shanghai introduced new measures to curb soaring home prices including restricting home purchases to one per household, increasing the supply of residential land, and using a property tax to cool the real estate market.

Property prices in 70 major cities rose 9.3 percent in August from a year earlier, prompting the government to extend a crackdown on speculators and multiple home purchases. Measures taken since April include curbing loans for third-home purchases, increasing down-payment requirements and raising mortgage rates.

The latest measures are “more significant than expected,” Deutsche Bank AG analysts led by Tony Tsang wrote in a report dated yesterday. “This in our view highlighted the strong determination of the central government and local governments to cool down the property market.”

Aluminum in London gained 0.9 percent to $2,345.25 a ton, lead climbed 1 percent to $2,230 a ton and nickel rose 1 percent to $24,128 a ton. Zinc was unchanged at $2,261 a ton, while tin added 0.4 percent to $25,700 a ton at 11:36 a.m. in Singapore.

http://www.bloomberg.com/news/2010-10-08/copper-rallies-heads-for-weekly-gain-as-shanghai-advances-after-holiday.html

[the cork]

Zinc dips, Copper May Climb for a Third Day as Dollar Drops Before U.S. Labor Reports
By Anna Stablum - Oct 7, 2010 4:19 AM PT

Copper may rise for a third day in London as the dollar weakens before reports that might signal a deteriorating U.S. labor market, potentially spurring more steps by the Federal Reserve to spur growth.

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, fell to the lowest level since January as it headed for a fourth weekly loss. Figures due today will show higher initial weekly claims for jobless benefits in the U.S., and a monthly report to be released tomorrow will show an increased unemployment rate, according to economists.

“The greenback is taking a further beating, with attention turning to U.S. jobs reports,” said Andrey Kryuchenkov, an analyst at VTB Capital in London.

Copper for delivery in three months added $4 to $8,263 a metric ton at 11:57 a.m. on the London Metal Exchange. December- delivery copper gained 0.2 percent to $3.76 a pound on the Comex in New York.

Today’s figures, due at 1:30 p.m. London time, may show U.S. initial jobless claims rose by 2,000 to 455,000 in the week ended Oct. 2, according to a Bloomberg survey of economists. Tomorrow’s report will show that the unemployment rate in the country climbed to 9.7 percent in September, a separate survey indicates.

Asset Purchases

U.S. two-year Treasury yields matched a record low today on speculation that the Fed will resume asset purchases, or so- called quantitative easing. The central bank bought $1.75 trillion of mortgage debt and Treasuries from August 2008 through March of this year. Fed policy makers meet Nov. 2-3.

“The Fed is likely to announce large-scale purchases of duration assets,” David Thurtell, a Citigroup Inc. analyst in London, said in a report e-mailed today. “We see the immediate impact of QE2 as market-friendly, in similar fashion to the impact of QE1. Copper seems likely to push into the mid-$8,000s over the coming few months and above $9,000 by mid-2011.”

The first round of quantitative easing helped to boost gold prices by 8 percent, Bank of America-Merrill Lynch said this month. Thurtell cited estimates by Citigroup economists for a total program of $250 billion to $1 trillion.

The dollar index dropped as much as 0.4 percent. A weaker U.S. currency makes dollar-priced metals cheaper in terms of other monies.

Relative Strength

Industrial production in Germany, the world’s third-largest copper user after China and the U.S., increased more than three times the pace economists forecast in August. Production jumped 1.7 percent from July, the Economy Ministry said.

LME copper’s 14-day relative strength index, a gauge of whether a commodity is overbought or oversold, was at 74.53. Some analysts and traders who study technical charts view levels above 70 as a signal that prices may be poised to retreat.

“Short-term upside for base metals might be limited, but we expect gains for most of them in the medium term,” said Thurtell. He pointed to emerging-market demand, supply limits and prospects for exchange-traded funds backed by industrial metals as the “main positives” in addition to prospects for more Fed asset purchases.

Commodity prices probably will stay “high by historical standards over the medium term, with risks tilted to the upside,” the International Monetary Fund said yesterday as it raised its forecast for global economic growth this year to 4.8 percent from 4.6 percent.

Pay Talks

In Chile, the world’s largest producer of copper, workers at Anglo American Plc and Xstrata Plc’s Collahuasi mine rejected a wage offer and will enter talks over new contracts ahead of an Oct. 31 deadline, union official Manuel Munoz said in an interview yesterday.

LME copper stockpiles fell to 373,450 tons, the lowest level since Nov. 2, exchange figures showed. Orders to draw copper from inventories, or canceled warrants, rose 20 percent, the most since Sept. 15, to 19,625 tons, after 11 declines in a row through yesterday, the longest such streak since August 2007.

Tin for three-month delivery on the LME rose 0.6 percent to $26,400 a ton after touching a record $26,790 a ton in the previous session. The metal is this year’s best LME performer, up 57 percent, after production disruptions in Indonesia and Democratic Republic of Congo bolstered prices.

Aluminum gained 0.6 percent to $2,378 a ton and nickel declined 0.4 percent to $24,710 a ton. Lead fell 0.5 percent to $2,303.75 a ton and zinc lost 0.3 percent to $2,327 a ton.

http://www.bloomberg.com/news/2010-10-07/copper-may-advance-for-third-day-as-dollar-drops-before-u-s-labor-reports.html

[the cork]

Zinc climbs 1.4%, Copper Extends Advance in London on Stimulus Support Outlook: LME Preview
By Glenys Sim - Oct 5, 2010 11:23 PM PT

Copper in London and New York climbed for a second day to the highest level in almost 27 months on expectations the dollar will weaken further as the Federal Reserve may join Japan’s central bank in taking quantitative easing measures to stimulate growth. Tin advanced to a record.

Copper for three-month delivery on the London Metal Exchange rose as much as 1.6 percent to $8,308 a metric ton, the highest price since July 15, 2008, and traded at $8,287 at 2:13 p.m. in Singapore. Zinc, lead, nickel and aluminum increased to five-month highs.

The December-delivery contract on the Comex in New York gained as much as 1.5 percent to $3.7805 a pound, also the highest level since July 15, 2008. The Shanghai Futures Exchange is closed until Oct. 7 for the National Day holiday.

“Accelerating weakness in the U.S. currency, driven by fears of renewed quantitative easing to confront sluggish growth, is proving to be a boon to commodity markets, especially as growth risks from the European sovereign debt crisis, policy tightening in China and high unemployment in the U.S. and Europe persist,” Morgan Stanley analysts including Peter Richardson wrote in a quarterly report today.

The dollar declined for a second day to the lowest level since January against a six-currency basket including the yen and euro. The Bank of Japan yesterday cut borrowing costs for the first time since 2008 and set up a 5 trillion yen ($60 billion) fund to buy state bonds and other assets.

U.S. initial jobless claims increased by 2,000 to 455,000 in the week ended Oct. 2, according to a Bloomberg News survey of economists ahead of tomorrow’s data, adding to expectations that the Fed will take steps to boost the world’s biggest economy. The unemployment rate climbed to 9.7 percent in September from 9.6 percent in August, according to a separate survey before an Oct. 8 report.

Copper Targets

Morgan Stanley today raised its copper forecasts through 2012 on “resilient Chinese demand.” The metal may average $3.31 a pound ($7,300 a ton) this year, up 3 percent from an earlier target of $3.21, the bank said in the report. It may average $3.60 in 2011 and $3.80 in 2012, up as much as 10 percent from previous estimates, the report said. The metal used in construction and appliances peaked at $8,940 on July 2, 2008.

Morgan Stanley joins Goldman Sachs Group Inc. in predicting higher prices. Goldman yesterday estimated copper would trade at $11,000 a ton in a year, up 37 percent from a previous estimate, as demand is expected to outpace supplies. The metal will be at $8,500 in three months and $8,800 in six months, the bank’s analysts including Joshua Crumb said in a report yesterday. Goldman also forecast copper to average $7,475 a ton in 2010 and $9,300 a ton in 2011. The metal has averaged $7,220 a ton so far this year.

Tin Record

Tin, the London Metal Exchange’s best performer this year, advanced to a record for a second day as shrinking global inventories and output disruptions raised concerns that supply may lag behind demand. The metal gained 2.6 percent to $26,600 a ton, a 55 percent jump this year.

Stockpiles tracked by the London Metal Exchange have dropped 53 percent this year, falling to a 17-month low of 12,495 tons on Oct. 1. Exports from Indonesia, the world’s biggest, declined for the first eight months of this year to 60,107 tons from 67,797.54 tons a year earlier, the Ministry of Trade in Jakarta said on Sept. 22.

Output in China, the world’s largest producer, may be restricted through the end of the year because of limitations on power use, tin industry group ITRI Ltd. said on Sept. 29. A general ban on mining was imposed last month in three eastern provinces in the Democratic Republic of Congo, Africa’s largest tin producer.

Metals, Equities

Zinc, the LME’s worst performer, rose as much as 1.4 percent to $2,345 a ton, the highest price since April 29. Nickel gained as much as 1.9 percent to $25,200 a ton, the highest level since May 4.

Aluminum rose as much as 0.9 percent to $2,400.50 a ton, the highest since April 21. Lead added as much as 1.5 percent to $2,345, the highest since April 26.

“The combined influence of improving physical market fundamentals, continued investment demand and, in some cases, inventory financing arrangements or exchange-traded funds” will drive base metals prices higher, said Richardson.

Morgan Stanley’s top picks for metals are copper, tin and nickel as they have the “potent combination of sustained emerging market demand growth, limited refined production growth and low inventories.”

The rally in metals prices drove gains in related equities. The MCSI World/Materials Index, a measure of mining and chemical companies, rose for a second day to the highest level since April 16. BHP Billiton Ltd., the world’s biggest mining company, gained as much as 2.6 percent in Sydney, and shares of Rio Tinto Group, the world’s third-largest mining company, jumped to the highest price since April 21.

http://www.bloomberg.com/news/2010-10-06/copper-in-london-new-york-surge-to-27-month-highs-tin-advances-to-record.html

[the cork]

Zinc gains, copper advances, Tin Makes Record High, Other Metals Edge Higher
Oct 05, 2010 (Dow Jones Commodities News via Comtex) -- By Matthew Walls
Of DOW JONES NEWSWIRES

LONDON (Dow Jones)--Tin on the London Metal Exchange rallied to a record high Tuesday, while other metals edged higher in quiet trading.

Tin hit a record high of $25,800 a metric ton, surpassing the previous record notched in the months before the financial crisis occurred in 2008.

Limited production growth in Indonesia and China and growing Chinese demand have tightened supplies, Credit Agricole analyst Robin Bhar said in a report Monday.

At 1056 GMT, three-month tin was trading at $25,699/ton, up $549 on Monday's close.

The metals got a lift from the euro's rebound against the dollar in what was otherwise a directionless session. China's financial markets are closed this week until Friday, depriving the market of one of its biggest price drivers.

Copper gained $56.75 to rise to $8,120.75/ton, but was still below Monday's high and Friday's five-month high of $8,178/ton. Nickel rose to a fresh five-month high of $24,400/ton. At 1056 GMT, nickel was $240 higher on the day at $24,380/ton.

Tuesday's key data point is the Institute Of Supply Management's U.S. non-manufacturing index for September.

Goldman Sachs Tuesday issued a bullish forecast for copper, predicting "periods of extreme tightness" in 2011. The U.S. bank upped its 12-month forecast by 37% to $11,000/ton.

"That will help the market, because there are a lot of people that will take that on board and (it will) bring new buyers to the market," said a metals trader in London.

Goldman also raised its 12-month zinc forecast by 35% to $3,000/ton. The bank cautioned nickel would switch from a supply deficit to a surplus, and kept its forecasts for nickel and aluminum largely unchanged at $19,500/ton and $2,200/ton respectively.

In other metals, zinc was $29 higher at $2,258/ton and lead was up $17 at $2,294/ton. Aluminum dropped $3.25 to $2,358.75/ton.

-By Matthew Walls, Dow Jones Newswires; [phone]; [e-mail]

(END) Dow Jones Newswires

10-05-10 0709ET

http://news.tradingcharts.com/futures/3/3/146456433.html

[the cork]

Zinc stable, Copper Advances for Second Day on Speculation Supply May Lag Behind Demand
By Glenys Sim - Oct 3, 2010 9:21 PM PT

Copper climbed for a second day, trading near a 26-month high, on speculation supply may lag behind demand as the consumption outlook improves in China, the world’s largest user. Nickel advanced to a five-month high.

Copper for three-month delivery on the London Metal Exchange gained as much as 0.8 percent to $8,162 a metric ton, and traded at $8,150 at 12:09 p.m. Singapore time. The contract rose as high as $8,178 a ton on Oct. 1, the highest level since July 22, 2008. Futures for December-delivery on the Comex in New York added as much as 0.6 percent to $3.7140 a pound. The Shanghai Futures Exchange is closed till Oct. 7 for the National Day holiday.

China will address “structural problems” and stabilize its economy by increasing domestic demand, Premier Wen Jiabao said in an interview with CNN yesterday. Wen also said he’d argued before the global recession that China’s economic development “lacks balance, coordination and sustainability.”

“China is still either not contributing very much or is a drag on global apparent demand growth for metals at the moment, but this is unlikely to last given the current levels of demand in end-use sectors, for which growth is set to remain robust,” Macquarie Group Ltd. analysts including Jim Lennon wrote in a Oct. 4 report. “This should mean that China is again likely to increase apparent demand whilst the rest of the world is slowing.”

Refined copper output will lag behind demand by 435,000 metric tons next year, the first shortage since 2007, according to the International Copper Study Group. The surplus is estimated at 200,000 tons this year and 166,000 tons for 2009, it said on Oct. 1.

Inventories monitored by the London Metal Exchange, down 26 percent this year, are at the lowest level since Nov. 3. Copper stockpiles tallied by the Shanghai Futures Exchange dropped to the lowest level in more than a year last week.

Aluminum and zinc in London were little changed at $2,356 a ton and $2,230 a ton respectively. Nickel climbed as much as 0.9 percent to $24,050 a ton, the highest price since May, lead gained 0.4 percent to $2,304 a ton and tin hadn’t traded as of 12:20 p.m. in Singapore.

http://www.bloomberg.com/news/2010-10-04/copper-advances-for-second-day-on-speculation-supply-may-lag-behind-demand.html

[the cork]

Zinc advances, Copper Climbs to Two-Year High on Chinese Manufacturing, Weakening Dollar
By Claudia Carpenter - Oct 1, 2010 6:08 AM PT

Copper rose to a two-year high in New York after a report showed that manufacturing accelerated in China, the world’s biggest consumer of the metal.

Manufacturing expanded at the fastest pace in four months, a report from China’s logistics federation and statistics bureau showed. Copper also climbed as the dollar slumped, making metals priced in the currency cheaper in terms of other monies and stoking demand for raw materials as an alternative investment.

“China is viewed as having engineered a gentle moderation in growth,” said David Thurtell, an analyst at Citigroup Inc. in London. “Not too hot, not too cold.”

Copper for delivery in December added 5.3 cents, or 1.5 percent, to $3.7045 a pound at 8:29 a.m. on the Comex in New York. Prices earlier today touched $3.72, the highest level since July 2008, and headed for a third straight weekly gain.

On the London Metal Exchange, copper for delivery in three months climbed 1.6 percent to $8,141 a metric ton ($3.51 a pound). Tin rose to within 1.6 percent of a record and nickel posted the longest winning streak since 2007.

China’s government-backed purchasing managers’ index rose to 53.8 from 51.7 in August, beating the median forecast of 52.5 in a Bloomberg News survey of 15 economists. A separate PMI released on Sept. 29 by HSBC Holdings Plc and Markit Economics climbed to a five-month high.

Weaker Dollar

The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, fell as much as 0.7 percent, on course for a third straight weekly retreat. The gauge slid 8.5 percent in the third quarter, contributing to the 23 percent advance by the LME Index of the six main metals traded on the exchange.

Inventories of copper monitored by the LME fell for a fifth day to 373,800 tons, the lowest level since Nov. 3. Stockpiles shrank for a 32nd week in a row this week. Aluminum inventories today dropped for a 12th straight session to 4.35 million tons, the lowest level since June 25, 2009.

Tin for three-month delivery on the LME added 3.1 percent to $25,000 a ton. Prices touched $25,100, the highest level since May 16, 2008, and $400 below the record achieved that month. The metal has jumped 47 percent this year, leading gains on the LME, after production was disrupted in Indonesia and the Democratic Republic of Congo.

Nickel climbed 2.1 percent to $23,900 a ton, the eighth consecutive gain and the longest rally since April 2007. Aluminum added 1 percent to $2,375.50 a ton after reaching $2,387, the highest price since April 21. Zinc advanced 1.5 percent to $2,228.50 a ton and lead rose 1.3 percent to $2,307.75 a ton.

http://www.bloomberg.com/news/2010-10-01/copper-climbs-to-26-month-high-on-china-manufacturing-weakening-dollar.html