Friday, December 03, 2010

War Metal

Mystery trader captures 80pc of London's copper market

"A single trader has gobbled up to four-fifths of the copper traded in London, stockpiling it in warehouses.
The unknown buyer has been building up the dominant position since at least last week, putting a squeeze on the market.
According to the rules of the London Metal Exchange, the trader must lend out copper if it holds between 50pc and 80pc of the total to maintain day-to-day liquidity in the market. The trader is currently lending at a 0.5pc premium to the cash price.

The premium for spot price copper over delivery in three months' time reached $89 in the middle of this week - the highest in two years."


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