FOR WEEK ENDING FEB.9 (Download report following text)
Last week I get an email from a person that says, “I would like to subscribe to The Copper Journal so I can use it as a sleep aid”.
I won’t identify that person, except to say his initials are M.W. – as in Mark Wlach.
My old friend Mark retired recently, after 42 years in the copper business.
Mark is one of those guys who started on the ground floor, literally, working at the Phelps Dodge, Laurel Hill refinery in Queens New York.
A copper refinery is where copper anodes are converted into copper cathodes, and this is the final step in the entire mining, smelting and refining process.
Mark moved up to the sales department at PD, where he was one of those individuals who was not only a great salesman, but also the person you knew you could depend upon to get the copper you needed, where and when you needed it.
As it turned out, over time, Magma Copper, BHP and Asarco all need a man like Mark to head up their sales team, and he did a great job for each and every one of these copper companies.
It is people like Mark, and many others we meet along the way in the global copper industry, that serve to remind us how important our relationships are, when business transactions can be conducted over the telephone, or by a handshake, because it is recognized that ‘your word is your bond’.
Mark said his new email address is a secret, because he does not want to be disturbed while he is watching Dr. Phil. But if you want it, just give me a call.
As for our metal markets this week, nothing terribly exciting, other than palladium making a new high, as it goes vertical, and a few other points of interest:
Copper inventories fell another 6,700 metric tons (mt) last week, and our back of the envelope calculation indicates that if the year-to-date pace of withdrawals keeps up, Cx inventories will be negative 10,000 mt by the time we get to June.
Also, the nearby backwardation on Comex has gone flat, but open interest in the Spot month is rising again, rather than falling.
And finally, our friends at Citi Bank said they expect copper to rally by 10% over the next 3 to 6 months.