Financial Daily from THE HINDU group of publications
Tuesday, Aug 23, 2005
Agri-Biz & Commodities
Industry & Economy - Metals
Domestic copper prices rise to record high
Mumbai , Aug. 22
COPPER wire bar prices in Mumbai on Monday touched a record high of Rs 216 a kg on steady domestic demand and firm LME trend, a trader said.
In the last three months, copper wire bar prices have increased seven per cent to Rs 216 per kg from Rs 202 per kg quoted on May 18 on continued domestic demand from cable manufacturers.
Prices were around Rs 210 per kg in the beginning of 2005.
Prices of copper scrap metals, including copper heavy, light, utensil and sheet cutting, also moved up by Rs 15-20 per kg in the past three months.
"Overall domestic demand is steady but offtake of finished metals is limited during the past few days as prices are rising," a leading metal trader said.
On the other hand, copper grade `A' prices at London Metal Exchange (LME) increased 20 per cent to $3,789 per tonne on Friday from $3,169 per tonne on May 18 on continued speculative buying by funds.
However, LME warehouse stocks have increased to 61,300 tonnes on Monday from 48,750 tonnes at the beginning of 2005 but they are down sharply from 4,30,000 tonnes at the beginning of 2004.
"Copper demand from power and telecommunication sector will continue.
However, domestic offtake of winding wire is expected to remain restricted," another trader said.
India's consumption during the first five months of 2005 increased 12 per cent compared with the same period in 2004, the International Copper Study Group (ICSG) said, in its preliminary report released last week.
"We estimate that growth in demand for copper in India has grown at around seven per cent per annum, over the past two years.
This growth rate should benefit from growing power sector demand, construction, air-conditioning and the automotive sector," Mr K.K. Kaura, Chief Executive of Vedanta Resources Plc, said in a annual report 2005.
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