Stockpiles monitored by the LME slid 26 percent since October to 351,200 tons, with Asian inventories plunging 82 percent in the period. Combined stockpiles tracked by bourses in London, New York and Shanghai tumbled 15 percent over the same period.
China's manufacturers started 2012 in a sluggish mode, suggesting Beijing will keep pulling pro-growth policy levers despite some early signs that a downward drift in factory activity is slowing, a survey of purchasing managers showed on Friday.
The HSBC flash manufacturing purchasing managers index, the earliest indicator of China's industrial activity, stood at 48.8 in January, a slight improvement on the 48.7 final reading of the December index that put the indicator at a three-month high.
China's central bank may reduce reserve ratios in the first half according to Shayne Heffernan. China's copper imports rose to a record last month as Lunar New Year stockpiling and financing needs spurred buying.
China, which consumes 40 percent of the world's copper, expanded 8.9 percent in the fourth quarter, the slowest pace in 10 quarters. That increased speculation the government will stimulate lending to shore up the economy. While global growth is slowing, demand is still exceeding supply from mines. The shortages will reach 363,000 tons this year.
The London Metal Exchange LMEX Index of six primary metals including copper and aluminum, fell 22 percent last year, the first drop in three years, as Europe's debt crisis widened. Yields on two-year Greek debt surged to 152 percent last month, compared with 0.29 percent for Treasuries of a similar maturity. China's inflation cooled to a 15-month low and producer-price gains were the smallest in two years in December, leaving the government more room to support growth.
Three-month copper on the London Metal Exchange traded at $8,390 a tonne, up 0.4 percent, at 0516 GMT. It earlier rose to $8,428.50 a tonne, its highest since Sept. 20. Prices have increased 4.9 percent this week.
The most-traded April copper contract on the Shanghai Futures Exchange rose 0.4 percent to 60,790 yuan ($9,600) a tonne. The exchange will be closed all of next week for the Lunar New Year holidays. Shayne Heffernan
Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.
Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services. www.livetradingnews.com