Copper prices have continued rising strongly, hitting their highest levels in six to seven months on major exchanges in New York and London as demand from China continues to drive the market.
Prices jumped after the latest figures, released in Beijing yesterday, showed that China lifted copper imports 61 per cent from March 2006 to307,740 tonnes,the highest ever.
May copper on Comex in New York rose 2 cents,to $US3.526 a/lb, the highest closing price for a most-active contract since October16.
And on the London Metal Exchange, three months copper closed at a seven month high after rising$US360,to $US7,700 a tonne. This booming demand from China has sent prices soaring 43 per cent since early February.New York traders claim prices may reach $US3.80 a pound in the next three months because global growth remains strong, and the demand from China shows no sign of slackening.Helping push up prices was news that LME stocks of copper fell to 177,600 tonnes, the lowest since mid-December. World stocks have fallen 15 per cent since the end of February.
All this is good news for the Australian market which should see the likes of BHP Billiton and Rio open solidly today.
The news of higher commodity prices helped add to upward pressure on the Australian dollar and it hit a new 17 year high of 82.70 USc overnight
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Swiss miner, Xstrata has been very busy: it has won a recommendation from directors of Canadian-Australian nickel group, LionOre Mining International for its $4.9 billion offer and also snared smallish NSW coal miner, Gloucester Coal for a further $391 million.
Gloucester Coal yesterday unanimously recommended that shareholders accept Xstrata Coal’s proposed $391 million takeover bid.
The two companies have entered into a merger implementation agreement for the proposed acquisition of all the shares in Gloucester by way of a scheme of agreement.
Gloucester recommended shareholders take up the $4.75 cash offer from Xstrata Coal.
“The Gloucester Coal share price has performed strongly since the refloat of the business via book build at 69 cents on April 5, 2004, almost three years ago to the day,” Gloucester chairman Andy Hogendijk said in a statement.
“The board believes the offer recognises the potential future growth of coal mining operations in the Gloucester Basin and in the board’s opinion represents an excellent outcome for the Gloucester Coal shareholders.”
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Meanwhile LionOre Mining International has recommended its shareholders accept the $US4 billion ($A4.9 billion) takeover bid for the company from Xstrata plc.
In a statement to the ASX yesterday, LionOre said Xstrata filed a formal offer of $C18.50 a share with Canadian regulators.
“LionOre has also filed its directors’ circular recommending LionOre shareholders accept the offer,” the company said.
The pair announced Xstrata’s plan to make a friendly takeover for LionOre on March 26. The offer, which is open until later this month, values the ordinary shares of LionOre at about $C4.6 billion, the equivalent of about $US4 billion.
LionOre is listed both in Canada and in Australia. On the ASX, it last traded at $A20.20 yesterday.
