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Copper melts lower

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.The Associated Press
Monday, March 11, 2013 12:01 am
Over the last decade, relatively high prices and expectations for rising Chinese demand led to significant investments in copper mining. Recent reports indicate that these investments will soon lead to the biggest increase in copper production in 13 years.Meanwhile, economic concerns in the United States and Europe have dampened demand for copper from the automobile and electronics industries, two major consumers of copper. Rising supplies and weak demand have combined to drive copper prices sharply lower, falling by more than 30 cents per pound, down 8 percent, over the last month.

In the big picture, the strength of the US housing market, China's economic growth, and investor demand for copper will all play a role in copper's value. As of midday Friday, copper was worth $3.50 per pound, near three-month lows.Hog prices declined to the lowest level in four months this week, falling to 78.25 cents per pound on Wednesday. Pork has been plunging for the last few months amid tepid consumer demand and fears that the sequester will further undercut meatpacking needs. Since late December, prices have fallen over 13 cents, down 14.8 percent.

On Thursday, the market rebounded, gaining nearly three cents per pound, up 3.2 percent, the biggest one-day rally in over three months. Some analysts attribute the rally to meatpackers buying aggressively as they saw pork prices under 80 cents as too cheap. Longer-term, bullish traders are hoping that China will increase imports of US pork. China is currently the third-largest buyer of U.S. pork.

As of midday Friday, April lean hogs were trading for 81.5 cents per pound.A USDA report issued midday Friday showed lower export demand for US wheat and increased projections for the size of the global wheat supply. This report confirmed the wheat market's fears of weak demand and rising supplies, knocking the grain lower.

Wheat prices have been falling in recent weeks as the Great Plains has been inundated with snow. Weather watchers are increasingly predicting that the recent snowfall and normal spring weather will provide the winter wheat crop with much-needed moisture.

As of midday Friday, wheat for delivery in March was worth $6.80 per bushel, near the lowest price in eight months.


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