Copper Drops for Fifth Time in Six Days on Bank ForecastJoe Richter and Maria Kolesnikova
Copper futures fell for the fifth time in six sessions after the World Bank lowered its estimate for global economic growth this year, stoking concern that demand for the metal will ebb.
The economy will expand 2.2 percent in 2013, below January’s 2.4 percent projection, the bank said yesterday. The forecast for developing nations was cut to 5.1 percent from 5.5 percent. China, the world’s top copper consumer, risks being forced to bail out some local authorities after a national audit showed a jump in loans, Moody’s Investors Service said. China’s equities fell to a six-month low.
“There’s growing concern over Asian demand, and the World Bank cut speaks to that,” David Meger, the director of metal trading at Vision Financial Markets in Chicago, said in a telephone interview. “China hasn’t come back to the market in a big way” after a three-day holiday, he said.
Copper futures for July delivery slid 1.3 percent to settle at $3.185 a pound at 1:19 p.m. on the Comex in New York. The metal has fallen 13 percent this year.
The price rose yesterday as Freeport-McMoRan Copper & Gold Inc. canceled shipments from its Grasberg site in Indonesia following a deadly accident in May. The mine shutdown is cutting output by 3 million pounds (1,361 metric tons) a day, equal to 2.9 percent of average daily global production in 2013.
“Grasberg should limit downside, but demand is not robust,” Bill O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in an e-mail.
BHP Billiton Ltd.’s Escondida site in Chile is the world’s largest copper mine, followed by Grasberg.
On the London Metal Exchange, copper for delivery in three months fell 1 percent to $7,050 a ton ($3.20 a pound).
Nickel declined to a four-year low, a day after inventories climbed to the highest since at least 1979.
The price dropped 1.5 percent to $14,060 a ton after touching $14,055, the lowest since June 4, 2009. Today, stockpiles fell less than 0.1 percent.
Aluminum, lead, tin and zinc also dropped in London.