Base metals

The weight of long copper positions on the London Metal Exchange has eased as prices have fallen, but traders are unwilling to heavily short in the current volatile price environment, market participants told Metal Bulletin.

Mining companies have radically overhauled the case for investment this year.

The dinner suits and posh frocks have hardly been put away since last week’s annual LME dinner but already there are signs that this most collective of “group hugs” in the metals industry has resulted in some much-needed price action on the upside and a jump in volumes on the exchange.

In the wake of an unexpectedly bullish LME Week, copper prices are on track to record the first annual increase in four years, reflecting growing confidence that demand could outperform next year at the same time as mine supply growth splutters.

With sufficient copper supply from the domestic market and an arbitrage window that remained largely shut this year, growing Chinese copper imports suggests demand from financing still exists.

The CME is open to adding other contracts to its industrial metal portfolio, global head of metals products Young-Jin Chang said in an interview during LME Week in London.