From Metals Bulletin, July 2:
CLOSE TO CLOSE: Copper price falls in kerb after swing into back
Copper prices fell late in the kerb session on the London Metal Exchange on Tuesday July 2, as backwardations flared out on the forward curve.
Three-month copper closed the day at $6,910 per tonne, after closing Monday’s kerb session at $6,979. The red metal reached a high of $6,982 per tonne and a low of $6,905. Backwardations have sprung out across the forward curve, with the cash-to-three-month spread reaching a backwardation of $23 per tonne just before 1500 BST, “The spreads have been steadily tightening, but it really started to flare yesterday and now everything from September onwards is in a...By Thursday Reuters was reporting:
...This helped push cash copper on Tuesday to an $8 premium against the benchmark three months contract, the highest in a year. The premium eased to $1.5 a tonne by Thursday....So the roll in copper is not something to bet on right now but the possibility of the backwardation becoming structural is there.
There was a reason we posted "Commodities: Backwardation vs. Normal Backwardation"a few weeks ago:
We're going to be hearing these terms a lot in the next few weeks....See also:
JPMorgan Comes Out With First "Overweight" Call On Commodities Since September 2010 (keep an eye out for crude backwardation)
Commodities: The New Credit Suisse Backwardation ETN (CSCR)
"Crude Surges Past $100 As Cairo Death Toll Rises"
And, if you only have time for a quick hit:
"Egyptian Troops On 'Maximum Alert" At Suez Sends Oil Over $102" (NOT)
