The price of copper is going down almost every day and is currently at 3.39.lb. Is there a correlation between this trend and silver and gold prices? Also any insight on why copper has been decreasing almost every day?
Since, copper is nearly entirely an industrial metal people are speculating demand will decrease in the future. There is a slight trend between silver and copper, not so much gold. I wonder if copper falls enough if it will force miners to stop production which would therefor help silver since there are only a handful of purely silver mines. Silver is usually a byproduct. For PM bugs like myself, we need low base metal prices in order to decrease supply of PM.
I think supply is also a factor. The high copper, silver, and gold prices has spurred renewed activity in opening up, expanding, or reopening copper mines. When you produce copper, gold and silver are always a byproduct.
Isn't the Iron Price supposed to plunge? (Saw something in FT a week ago... ?) That screams deflation IMO and I believe we're trapped in a supercycle deflationary collapse, unfolding in stages. Gold seems somewhat immune from radical correction, though: http://www.forbes.com/sites/afontev...ght-more-than-3-trillion-in-gold-in-2013-ubs/ I suspected that other PMs (especially Rh) showed this deflationary trend. I don't think Rh can go much lower (based on the historic Au/Rh ratio) but what do I know?!
I view it more as a symptom of China's purchasing power. I own shares in a large iron ore miner, and from what I have read China is simply squeezing them on price hard right now. With the rest of the world not really picking up the slack, this pressure from China is even more stressful on the bottom line. I think China still needs the ore, just are being smart how they obtain it. I do not necessarily believe its a symptom of a global slowdown. I have never been a believer in rhodium. I view it only as an industrial metal, not a precious metal. Therefor I have never paid attention to the market, only seeing it ever mentioned on Kitco's site.
Not to mention a renewed surge in the theft of copper pipe and wire from commercial buildings, homes, power lines, A/C units, new construction sites and pipe supply yards. If the price falls enough, it may not be worth stealing anymore.
I am always reading up on PM such as gold, silver and platinum because it fascinates me, but I as well am not a believer in rhodium and currently have no interest in investing in it.
I would rather invest in pork bellies over rhodium. Not physical pork bellies, it would stink my house up after ahwhile, but it may be a good futures play.
Palladium is cool too. With China stepping up its standard on air pollution it might make a good play.
I hope if copper keeps going down they can make "copper bullion" rounds and or big bars that are NOT a rip off in price.:dead-horse:
Good point. I like those and would like to own some, but I refuse to pay anything close to the price they are going for. I just can't understand buying something for a oz of metal that should be the price of a pound of that same metal.
Copper is often referred to as "Dr. Copper" for good reason. It is one of the best leading indicators for the economy as a solely industrial metal that is required in large quantities for construction. Falling copper prices do not bode well at this point. There is not a lot of correlation with copper and precious metals. Copper is not so precious. Silver as a dual role monetary and industrial metal has some correlation, but history shows that when given a divergence between copper and gold that silver will follow gold over copper.
Copper premiums aren't likely to drop. If you can find a 1 oz round for less than $1 that's a darn good deal. As per http://coppercave.com/copper/index.php?_a=viewDoc&docId=5 There are several factors that lead to what appear to be high premiums on copper bullion when compared to the spot price shown for paper markets. The first factor is that copper is difficult to process. Unlike silver and gold, which melt very nicely and do not oxidize easily when molten, copper oxidizes readily when heated. It requires the use of special techniques or chemicals to produce pure copper without bubbles or contaminants forming. As a result of this extra handling, pure copper is difficult to obtain anywhere close to the raw market trading price unless you have a contract to take regular delivery of multiple tons each month. In more realistic quantities, pure copper stock often runs in excess of $6 - $8 a pound. Factor in the expense of processing, sizing, finishing, stamping or engraving, and shipping, and the price has reached the level you see on the website.
