SEC ignored risks of copper ETF: Southwire
Mar 26, 2013 | 10:09 AM
| Andrea Hotter
NEW YORK The Securities and Exchange Commission (SEC) ignored warnings over the impact a physical copper exchange-traded fund (ETF) sponsored by JPMorgan Chase & Co. could have on lengthy queues at London Metal Exchange warehouses and on the incentives and premiums paid for metal, according to a court filing by a major U.S. copper consumer.
Carrollton, Ga.-based copper fabricator Southwire Co. said in documents filed with the U.S. Court of Appeals in Washington that the SEC failed to consider evidence it had provided showing the launch of a physical ETF could exacerbate a "bidding war" for copper among competing warehouse owners and end users.
The market is "already being severely constricted as a result of owners of LME warehouses paying huge premiums to metal producers to place copper that otherwise would be available for immediate delivery into warehouses with lengthy queues for physical delivery," the filing said.
Copper premiums in Antwerp jumped to as much as $100 per tonne last week, in line with incentives being offered by traders and warehouses to draw the metal into storage, according to AMM sister publication Metal Bulletin. ....
To access AMM's full content, please log in below. If you do not have an AMM account, we invite you to take a free trial or subscribe below.
Already a registered amm.com user?
Access to amm.com editorial content is granted only to paid subscribers and trialists. If you do not have an active account in your own name, please either subscribe or take a trial and you will have instant access to amm.com content. Sharing your login credentials with individuals who are not subscribers represents a violation of AMM copyright.
Every morning, every minute no matter how often you follow the markets, there's an AMM subscription to fit your needs.
Not sure if you are ready to invest in a subscription right now? Take a free, no-obligation trial. Start your free trial today.