Copper finished last year at about half the price it started with, but lately it’s been showing signs of life — and that’s thanks to China.
That doesn’t necessarily mean that the 4 trillion yuan ($585 billion) stimulus plan for the world’s largest copper-consuming country is working, but analysts are starting to be a bit more upbeat over the metal’s prospects.
On Thursday, copper prices climbed to a four-month high of nearly $1.90 per pound on the Comex division of the New York Mercantile Exchange.
Chinese demand for the industrial metal had fallen sharply back in the final quarter of 2008 as “a result of the global downturn, which left no region or country unscathed,” said Martin Hayes, an analyst at BaseMetals.com.
But China introduced financial stimulus plans in November, which are expected to kick in later this year and through to 2010 in “massive infrastructure projects,” he said. Those projects “will use significant tonnage of base metals, including copper.”
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