Farallon Resources Ltd. (fka FRLIF)

[the cork]

Zinc climbs, Copper Rebounds From One-Month Low on Hopes Chinese Demand Will Improve

By Glenys Sim - Aug 25, 2010 12:56 AM PT


Copper gained after a slump to a one-month low encouraged purchases by investors expecting demand to improve as the seasonally weak consumption period ends.

Copper for three-month delivery on the London Metal Exchange rose as much as 0.9 percent to $7,200 a metric ton, and traded at $7,181 at 3:52 p.m. in Singapore. The metal, used in construction and appliances, dropped to $7,137 a ton yesterday, the lowest level since July 27. The December-delivery contract on the Shanghai Futures Exchange ended little changed at 56,690 yuan ($8,338) a ton, after falling as much as 0.9 percent.

“The slow-demand season is nearing its end and we’re not seeing signs that the government will further clamp down on the property market,” said Liang Haisan, an analyst at CITIC Newedge Futures Co. “There will be people buying in anticipation of a pickup in demand next month.”

Immediate-delivery copper in Changjiang, Shanghai’s biggest cash market, has been trading above the most-active futures contract for the past week. The condition, known as backwardation, suggests near-term demand may increase.

Last week, copper inventories in Shanghai shrank for the first time in three weeks, by 3,499 tons to 110,371 tons, according to the exchange.

Copper is still down 3.6 percent this year as China’s regulators took steps to prevent asset-price bubbles. Chinese authorities boosted banks’ reserve requirements three times this year and introduced real-estate curbs to cool lending and speculation.

Aluminum in London advanced 0.4 percent to $2,035 a ton, while zinc climbed 1.1 percent to $2,013.50 a ton. Lead fell 0.2 percent to $2,008 a ton, nickel was unchanged at $20,600 a ton, and tin gained 0.2 percent to $20,430 a ton.

http://www.bloomberg.com/news/2010-08-25/copper-rebounds-from-one-month-low-on-hopes-chinese-demand-will-improve.html