A report in the Wall Street Journal today says two major commodities-trading firms are
amassing much of the world’s copper supplies in their warehouses, partly by
paying to divert shipments away from other storage hubs, traders and analysts
say.
Some manufacturers and builders, the report
says, are worried that those stockpiles of copper could prove tough to procure
if demand were to pick up sharply or output from mines were disrupted.
“The current situation, where LME (London Metal Exchange) warehouse
owners are paying huge incentives to attract copper, and then have those units
subject to long load-out queues, is effectively making that copper unavailable
for immediate delivery to serve industrial consumers,” a spokesman for
Southwire Co., the largest U.S. copper-wire maker, said in an emailed statement
to the newspaper.
“Copper prices have fallen since
February amid expectations of a supply glut, but buyers say they are starting
to pay hefty fees to get metal when they need it—on top of the actual price of
copper—because so much is being diverted into warehouses,” the newspaper said.
For the full article click on to www.wsj.com
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