Warehouses offer incentives for copper storage
Oct 08, 2012 | 03:03 PM
| Andrea Hotter
NEW YORK New Orleans warehousing companies are offering lucrative incentives for copper to be stored in their sheds, which already have huge queues for material, traders said.
The citys London Metal Exchange-approved warehouses took in 4,525 tonnes of copper last week alone, with parcels of Chilean metal taken into stock on incentives of more than $100 per tonne.
The high incentives could create a new flash point in the debate about warehousing, with owners of metal in New Orleans warehouses already having to wait about six months to obtain their metal, people familiar with the issue told AMM sister publication Metal Bulletin.
"Theres a concerted effort to buy the Chilean material that is floating around to put into New Orleans warehouses and create a queue," a trader whose company is active in physical copper in the region said. "Incentives of over $100 are being offered, and its simply a game to tighten the market."
More than half of the 900,000 tonnes of various metals stored across the 59 LME-approved warehouses in New Orleans is on canceled warrant, meaning it is awaiting delivery out by one of the six companies operating there.....
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