Copper Falls for Third Straight Session as China's Imports Drop

LONDON, July 8 -- Copper prices fell for the third straight session in New York on concern that demand will slide in China, the world's biggest metal user.

    Copper imports by China may plunge 64 percent in the second half after record shipments this year led to excess inventories, UBS AG said yesterday. Copper futures have dropped 4.5 percent since July 1.

    "There is more and more evidence that China has stockpiled a bit, and they have plenty of supply," said Joel Crane, an analyst at Deutsche Bank AG in New York. "Supply tightness will ease" as China's pace of imports slows, he said.

    Copper futures for September delivery dropped 3.7 cents, or 1.6 percent, to $2.2255 a pound on the Comex division of the New York Mercantile Exchange.

    The price also fell today after U.S. regulators said they may clamp down on speculation in commodity markets by limiting investors' futures holdings and index and exchange-traded funds. Gary Gensler, the chairman of the Commodity Futures Trading Commission, said that hearings will be held this month and next on speculative trading.

    "These possible CFTC limitations are going to be a huge factor for prices for a lot of commodities," said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. "Speculators are being driven out of the market now as they get nervous about what limitations might be put in."

    The Reuters/Jefferies CRB Index of 19 raw materials declined for the third straight session to a seven-week low.

    On the London Metal Exchange, copper for delivery in three months fell $90, or 1.8 percent, to $4,880 a metric ton ($2.21 a pound). The price has dropped 42 percent in the past year as the global recession cut demand.

    On the LME, aluminum was little changed at $1,618 a ton. Zinc rose 0.3 percent to $1,569, and nickel was down 1.9 percent to $15,650. Lead lost 1.4 percent to $1,660. Tin slipped 0.9 percent to $14,150.

    (Source: Bloomberg)