By Li Xiaowei
Dec. 19 (Bloomberg) -- Copper futures on the Shanghai Futures Exchange plunged by the daily limit to the lowest in five years after global inventories climbed, signaling waning demand during the recession.
Copper fell to a four-year low yesterday on the London Metal exchange after the exchange-monitored stockpiles rose to 324,175 metric tons, the highest level since Feb. 12, 2004. Canceled warrants, or metal booked for withdrawal, totaled 4,775 tons.
“The unrelenting gains in London inventory and the extremely low ratio of cancelled warrants to total stockpiles indicate weak fundamentals are here to stay,” Wang Lei, an analyst at Haitong Futures Co., said from Shanghai.
Copper for March delivery fell 4 percent from the previous settlement price to 22,320 yuan ($3,265) a ton at the market’s open, the lowest intra-day price since December 2003. The contract traded at 22,500 yuan at 10:39 a.m. local time.
London copper was untraded after closing down 4.6 percent at $2,880 yesterday, the lowest since December 2004. The price is down 57 percent this year, heading for the first annual decline since 2001.
Global copper production exceeded demand by 30,600 tons in the 10 months ended Oct. 31, the World Bureau of Metal Statistics said Dec. 17.
To contact the reporter for this story: Li Xiaowei in Shanghai at Xli12@bloomberg.net
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