Copper Hits New 7-Year High On Tight Supplies, Strong Demand
Undated (AP) _ Strong demand for tight supplies of copper pushed the price Thursday for future delivery of the metal to $1.40 a pound, its highest price in more than seven years.
On other markets, precious metals advanced, grain and soybean futures retreated; livestock and meat were higher; and energy futures declined, all in shortened Christmas Eve trading sessions. Stock-index futures retreated.
With copper supplies continuing to decline, many copper traders on New York’s Commodity Exchange were unwilling to sit out the long holiday weekend holding ″short″ or sell positions, said Bernard Savakl, an analyst in New York with PaineWebber Inc.
″Trading was steady and underpinned by supply tightness fears and a lack of sellers in the thin pre-holiday trading,″ Savakl said.
The dollar’s weakness against major foreign currencies contributed to copper’s surge, he said.
The contract for December delivery of copper settled 4 cents higher at $1.40 a pound, the highest U.S. copper futures price since February 1980, when the contract hit an all-time high of $1.43 a pound, said Frederick Demler, metals economist for Drexel Burnham Lambert Inc.
Gold and silver futures gained modestly on the Comex, supported by the weaker dollar and feelings among traders that the dollar would continue to slide lower, Savakl said.
Gold settled $3.10 to $3.20 higher with December at $486.10 a troy ounce; silver was 7 cents to 7.1 cents higher with December at $6.80 a troy ounce.
Most grain and soybean futures closed modestly lower in an abbreviated session on the Chicago Board of Trade.
″It was really a skinny trade″ since many traders had ended their week Wednesday, said Dale Gustafson, an analyst in Chicago for Drexel Burnham Lambert Inc.,
Some new export business in soybean meal and higher prices for imported tropical oils gave soybean products a slight boost, but the beans closed lower, he said.
Wheat was lower following Wednesday’s weekly government wheat auction, Gustafson said. The Agriculture Department said it had sold 25.5 million bushels of wheat in the auction.
Corn retreated slightly in thin trading.
Wheat settled 3/4 cent to 3 1/2 cents lower with March at $3.15 a bushel; corn was unchanged to 3/4 cent lower with March at $1.89 1/2 a bushel; oats were 1 1/4 cents to 2 cents lower with March at $1.90 a bushel; soybeans were 3 3/4 cents lower to 1 cent higher with January at $6.03 3/4 a bushel.
Most livestock and meat futures advanced as traders sought to cover their positions before the weekend, said Chuck Levitt, an analyst in Chicago with Shearson Lehman Brothers Inc.
Cattle futures also were strengthened by forecasts for stormy wintry weather this weekend. Heavy snows could slow the movement of cattle to market, creating a supply backlog, he said.
Pork futures gained on expectations that relatively low slaughter numbers this week would mean greater supplies next week, Levitt said.
In addition, many pork traders are hesitant to trade in advance of the Agriculture Department’s Jan. 6 quarterly hogs and pigs report, Levitt said.
He said he expects the report to show a 10 percent increase in the nation’s hog herd.
Live cattle were .10 cent to .62 cent higher with February at $61.37 cents a pound; feeder cattle were .55 cent to .80 cent higher with January at 74.60 cents a pound; live hogs were .07 cent lower to .32 cent higher with February at 41.15 cents a pound; frozen pork bellies were .17 cent to .58 cent higher with February at 50.42 cents a pound.
Energy futures dipped as traders took profits from a rally earlier this week, analysts said.
Volume was extremely light before the holiday.
West Texas Intermediate crude oil settled 7 cents to 12 cents lower with February at $16.52 a barrel; wholesale heating oil was .07 cent to .33 cent lower with January at 51.25 cents a gallon; wholesale unleaded gasoline was .14 cent to .36 cent lower with January at 43.43 cents a gallon.
Stock-index futures retreated on the Chicago Mercantile Exchange, with the contract for March delivery of the Standard & Poor’s 500 index settling 1.40 points lower at 253.30. The spot index closed at 252.03.