Copper Falls to 2-Week Low After Rio's Beats Forecasts - Bloomberg

Copper fell for a third day in London on concern the euro-region debt crisis is sapping the economy in Germany, the world’s third-biggest user of the metal. Growth in gross domestic product slowed to 0.7 percent last year from 3 percent in 2011, Germany’s statistics office said today. Economists surveyed by Bloomberg forecast a gain of 0.8 percent. Prices also slid after Rio Tinto Group’s production of mined copper topped analyst estimates, indicating ample supply. “Obviously it’s slightly bad news for Europe, as Germany is what’s dragging the European economy at the moment,” Christin Tuxen, an analyst at Danske Bank A/S in Copenhagen, said by phone today, referring to the German GDP figures. Copper for delivery in three months dropped 0.4 percent to $7,969 a metric ton by 10:17 a.m. on the London Metal Exchange. Prices reached $7,967.25, the lowest level since Dec. 31. Copper for delivery in March fell 0.3 percent to $3.622 a pound on the Comex in New York. “Metal markets will be much more focused on what comes out of China” this week, Tuxen said. Figures due Jan. 18 may show GDP growth strengthened in the fourth quarter and industrial production was little changed last month in the country, the world’s biggest copper consumer, according to analysts. A report today may show retail sales in the U.S., the second-ranking copper user, climbed in December, according to a survey. Tuxen predicted “a positive reading that could lead to dollar strength.” Gains by the currency make raw materials less appealing as an alternative investment. Copper production from mines jumped 20 percent to 163,900 tons in the fourth quarter, Rio said in a statement. Output rose 6 percent for all of 2012, helped by higher ore grades at Chile’s Escondida, the world’s biggest mine for the metal. The market’s surplus will expand to 151,000 tons this year from 49,000 tons in 2012, according to Barclays Plc. Copper stockpiles monitored by the LME rose 1.1 percent to 333,275 tons, the highest level since Jan. 27, on gains in Antwerp, Belgium. Inventories in Europe reached the highest since March 8, 2010. Orders to withdraw copper from warehouses fell for a sixth session in seven to 58,850 tons. Aluminum, zinc, lead and nickel slid in London. Tin rose.