Copper Advances to Three-Month High

By Joel ScanlonJul 20 2011

Copper prices have been racing up over the last couple of years as the demand for the red metal far out reaches current supply. The base metal has seen its highest price in the last three months as both India and China compete for it.

As per the new data compiled by the US Commerce Department the price of copper is up 14.6% in June . It is not just America that finds copper rates rising as three-month contracts for the metal used in construction and manufacturing were up to $9,754.50 per tonne on the London Metal Exchange.

Copper futures are also trading at $4.44 a pound. With increased demand from China despite growing concerns over its economic sustainability, the copper producers are ready to reap profits for a while as yet. The signal for strong copper demand over the next few years is loud and clear.

As per Standard Bank analyst Leon Westgate with Chinese growth still chugging along nicely, in spite of tighter monetary conditions, it may be that copper is now also being seen in the same light as gold, and is also benefiting from the wider uncertainty in the global markets and investor interest in hard assets.