Bearish copper narrowly misses $6,000

Mon, 12 Dec 2016 12:11:48 +0000

By SIMON MWANZA

DEMAND for copper in 2017 will increase by 1.8 percent and this is good news for Zambia and other countries whose economies are dependent on the copper mining industry, says the International Copper Study Group (ICSG)

Copper contributes 10 percent to Zambia’s GDP and accounts for 60 percent of the country’s total exports.

ICSG, in its latest report, is of the view that a higher demand of the red metal will create an upturn in the market and increase prices, as predicted by the World Bank.

As on December 9 copper official price on the London Metal Exchange (LME) stood at $5,824.00 a tonne.

Cavmont Bank Zambia daily market reported that copper narrowly missed the US$6,000 a tonne mark two days ago and on Thursday posted a $5,769.50 ceiling on the LME after the price dropped by $152.50 to a tonne.

The official target for copper production in Zambia is about 1.5 million tonnes per annum by 2017, while the Institute of International Finance (IIF) projects a 5 percent rise in 2016 to 746,000 tonnes – thanks to increased copper output of new mines.

Cavmont further reported that the price of gold went up by $3.40 to drive the selling price of the prized metal to $1,175.82 an ounce.

The price of Brent crude oil however suffered a minor $0.21 jolt and the commodity was presently selling at $53.09 a barrel.

On the local scene, the Kwacha was unchanged against the US dollar in tandem with other currencies that have remained bullish against the world’s reserve currency.

The local unit, which opened at K9.850 / K9.900, failed to make any meaningful gains despite a Treasury Bill auction by the Bank of Zambia on the same day. The Kwacha closed at K9.850 / K9.900 and local currency is expected to remain range-bound with a slight bias towards appreciation as copper prices continue to show a positive trajectory.

The Lusaka Stock Exchange (LuSE) All Share Index rose by 0.94 percent to post 4,198.29 points.