Jim Letourneau's Blog

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Copper Cracking or Ready to Rebound?

I get emails from a variety of sources but a recent one had some pretty interesting things to say about the copper price.


  • China's imports of copper ores and concentrates rose 42 percent on the year to 675,928 tonnes in August, the second-highest level after a monthly record of 683,523 tonnes in September 2010.
  • Chinese copper smelter treatment and refining charges (TC/RCs) fell 18 percent between July and early September and have declined further in the past two weeks due to shipment delays.
  • The new President of Zambia has has promised to re-introduce the windfall mining tax.
  • Grasberg is on strike and the unions are threatening to extend the action beyond 30 days. Each lost month is about 40,000 t of copper, 25% more than Capstone produces per year.
  • Technically, the relative strength index for copper is at a 15 year low.

The supply side of the copper equation is struggling to keep up to demand but if that demand disappears, look out below.