Copper Supply Tightening in Europe

Copper metal supply is shortening in Europe due to strikes at Corporacion Nacional del Cobre de Chile (CODELCO). Copper inventory held by London Metal Exchange has halved in Europe since the end of 2007. The spot premium for European users is currently soaring to around US$ 115 per tonne CIF Rotterdam from US$ 60-70 at the beginning of this year.LME copper inventory totaled 125,375 tonnes on 23 May, decreasing by 36% from the end of 2007. The inventory in Europe is about 22,000 tonnes, which decreased by 52% from 46,500 tonnes at the end of 2007.The year-on-year demand growth for copper metal in Europe is forecasted to slow down to 5.3% in 2008 from 5.6% in 2007, according to the report by Triland Metals, UK. Copper metal supply is locally tightening despite of slower demand growth.Copper production seemed to decrease by maximum 30,000 tonnes during April-May when CODELCO’s contract workers entered strikes. Cananea mine of Mexico is still under a strike. Copper supply from South America is decreasing.