Now here’s something interesting. Copper stockpiles in China are now at the highest level since at least 2003. Normally, when there is a big stockpile of a commodity, the prices go down. But that’s not happening this time .. at least not yet.
Instead, copper prices recently hit a 20-month high. While copper prices have eased a bit, they are still near their highs.
Here are more mixed signals. Xstrata says China copper demand will rise by as much as 10% this year – that’s huge. HUGE! And yet there are also concerns that China will use less copper as it moves to cool its overheated real estate market.
Damn, I’m confused. Let’s look at a chart of copper …
Copper is clearly in a strong uptrend. It seems to be headed to test overhead resistance around $4 a pound. To be sure, the high stockpiles may be a fundamental indicator that copper prices are going to go lower. But we aren’t seeing it reflected on the chart yet.
Here’s one more thing to consider. A 2006 study said that 26% of extractable copper in the Earth’s crust is already landfilled or otherwise lost in non-recycled wastes. The cheap, easy-to-mine copper is already mined. Have we hit Peak Copper? Could we push above $4 a pound?
Related Posts
- Copper continues to get clobbered (11/10/08)
- Doctor Copper’s Prescription for Global Growth (07/23/10)
- China Continues to Devour Copper (04/21/10)
- More Evidence That Peak Oil Crisis Looms (05/28/08)
- Peak Moment TV Interview — Energy Crisis and More (04/18/10)
{ 1 trackback }
{ 0 comments… add one now }