Copper futures for December delivery gained 0.7 percent $7,895 per ton on the London Metal, Exchange, reported the Financial Times Thursday. The surge in the red metal's price may be coming from strong Chinese demand for the metal.
China has ramped up its copper purchases as it continues a broad rural electrification program to bring consistent energy to its hundreds of millions of poor, rural farmers. In addition, it's also investing heavily in renewable energies, which require copper both for the installation and for the electrical infrastructure.
Barclays Capital believes that as inventories drop towards record lows in 2011, the price of the metal will rise, possibly to as high as $8,940 per ton.
Currently, inventories at London Metal Exchange warehouses are at 380,125 tons, down 31 percent from the 550,000-ton peak set back in February.
"Strong demand from China and elsewhere," is supporting the price, Leon Westgate, a base metals analyst at London's Standard Bank, told the FT. The market, said Westgate, is experiencing "a tightening fundamental outlook boosting sentiment."
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