Last Updated :
08 January 2010 at 04:00 IST
Base metals shine in 2010
MUMBAI (Commodity Online): Investors who rush to gold may read this report carefully. According to various business newspapers published across the world, base metals are set to shine in 2010.
Aided by strong signs of economic recovery in the US, China and Europe — and importantly, also aided by production disruptions because of cold weather in China — prices of copper, zinc, lead, aluminium, nickel and tin have all climbed to new highs last week.
This week, the three-month Shanghai aluminum futures rose by their daily 5% limit from the previous session’s settlement to 18,045 yuan a tonne — a rise unheard of since December 2005, when the metal climbed uninterrupted for several days, before correcting marginally.
Three-month copper futures on the London Metal Exchange (LME) hit $7,648 a tonne — that’s the highest since August 28, 2008. Similarly, aluminium prices on the LME also climbed to multi-month highs largely over fear that supplies could be disrupted from mines in China because of harsh weather there.
In India, which usually takes directions from the global markets, metal prices are also on the boil. Copper futures locally, for the month of February, touched a contract high of Rs 351.9 per kg largely because of strong global cues.
According to India’s Financial Express newspaper, the rub-off effect of the strong rise in metal prices has pushed Bombay Stock Exchange to a 22-month high. The BSE metal index rose by 233.7% in 2009.
Aluminium jumped 3.2 per cent at LME to $2,375 a tonne on concerns that production in China could be disrupted by severe winter weather and resulting power shortages.
Copper gained 2.7 per cent to $7,685 a tonne in spite of news that workers at Chuquicamata in Chile, the world’s second-largest mine, had accepted an improved wage offer from Codelco, the world’s largest copper producer.
Codelco expects copper output to have reached record levels in 2009, above the peak of 1.73m tonnes in 2004.
Arctic conditions in Mongolia have led to the closure of some lead and zinc mines, boosting prices. Zinc raced 5 per cent higher to $2,705 a tonne while lead jumped 5.4 per cent to $2,660 a tonne. Traders said short covering (closing bets on prices falling) was partially responsible for yesterday’s gains. Nickel added 1.8 per cent to $19,040 a tonne.
MCX Light Sweet Crude Oil 19 June 2012
contract was trading at
Rs 5241 , up Rs. 233 . What's your view on it?
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