Copper falls as high prices discourage buyers

Copper slipped Wednesday as businesses hold back on purchases because of higher prices.

Some manufacturers have stockpiled inventories of copper. Others are cutting back on purchases or substituting different materials in certain applications.

That has kept pressure on copper prices, which have traded in a narrow range between $4.226 a pound and $4.6285 a pound this year.

CPM Group analyst Carlos Sanchez said he has seen similar trends in in other metals. There also are questions about whether copper demand may wane in China as it pushes measures to control inflation and the pace of its economic growth.

Sanchez said he expects copper demand to remain strong, particularly in developing countries. The metal is used largely in consumer electronics, construction materials and transportation.

Copper for March delivery fell 6.6 cents to settle at $4.47 a pound.

In other metals trading, April gold added $1 to settle at $1,375.10 an ounce.

In other March metals contracts, silver fell 6.7 cents to settle at $30.629 an ounce and palladium lost $1.55 to $838.35 an ounce. April platinum added $2.70 to settle at $1,834.30 an ounce and April gold added $1 to settle at $1,375.10 an ounce.

In energy trading, oil prices rose after Israel's foreign ministers said that Iran will send two warships through the Suez Canal on the way to Syria.

The news added to tension in the region and "absolutely moved markets," according to PFGBest oil analyst Phil Flynn. Flynn said traders are worried that spreading unrest in the Middle East will disrupt oil production and shipments in the region.

Benchmark oil for March delivery rose 67 cents to settle at $84.99 per barrel.

In other Nymex trading, heating oil rose 4.58 cents to settle at $2.7748 a gallon and gasoline gained 5.59 cents to $2.5447 a gallon. Natural gas lost 5.5 cents to settle at $3.921 per 1,000 cubic feet.

Grains and beans were mostly lower. In contracts for March delivery, wheat fell 3.25 cents to settle at $8.37 a bushel, corn was unchanged at $6.905 a bushel and soybeans lost 2 cents to settle at $13.66 a bushel.

(Source: http://www.bloomberg.com/news/2011-02-16/copper-falls-as-high-prices-discourage-some-buying.html)