MercoPress. South Atlantic News Agency

Copper at its highest in 41 years and keeps rising

Current boom copper demand has catapulted the value of the metal to its highest price in more than 40 years. The Chilean Copper Commission reported that the average copper price through September this reached 3.27 US dollar per pound, highest average price since 1966, when the commodity averaged US$3.63 for the year.

London investment bankers expect copper prices to continue increasing until the end of the year, with all indicators suggesting that it will break US$4 per pound by the year's end. This would be a market first for the metal: even in Europe's post-war industrialization drive in the 1960s copper never broke the US$4 per pound barrier. "The weakness of the dollar against both the € and the yen has caused the value of copper to rise sharply, making it more convenient for these economies to purchase the metal" said Nick Moore, economist with ABN AMRO in London. The head of base metals at JP Morgan, Jon Bergtheil, believes that in the last part of this year copper will peak to its highest price in history. "Now winter (in the northern hemisphere) is starting, the economy will react and China has shown no sign of changing its demand. In fact, it could well be entering the market to buy more." Bergtheil's view is endorsed by Juan Carlos Guajardo, director of the Center for Copper Studies (CESCO). "The conditions are here for a rally in copper prices, if there is not any major turbulence in the world economy. By the end of the year, copper will be about US$4 per pound". The price surge results from strong demand in places like China, coupled with strikes in large Peruvian copper mines. Although these disputes may be resolved in the near future, Gustavo Lagos, the director of the Universidad Catolica Mining Center, feels that the East's appetite for the metal will continue to drive prices up. "Although the United States has reduced its demand, China's economy requires almost four million tons of copper every year, twice the North American needs." The Santiago Times