NEW YORK — Copper spot activity may pick up this year after consumers booked less material on contract for 2013, traders and consumers told AMM.

Consumers were unwilling to lock up 2013 material late last year as the demand picture remained hazy (amm.com, Nov. 30), and sources said that their continued reluctance could lead to more spot activity this year.

One trader estimated that consumers booked only 60 to 70 percent of their needs on contract for 2013 vs. 70 to 80 percent in 2012. "Last year, (consumers) were left with a lot more inventory than they needed, they were consistently financing and rolling over and asking for cancellations. This year, they’re being more cautious," he told AMM. "I know a few consumers are (still) working their way through last year’s inventories. ... Going into February or March, (they) will start to look at bringing in more metal."

"People overbought and there was a hangover in 2012. In November, no one really got anything done. (But) I don’t think it’s going to be the same thing this year," a second trader said. "(Consumers) may buy more spot."

"People have cut back (contract purchases). It’s going to be interesting this year," a consumer told AMM.

A second consumer said he was able to negotiate a range for how much cathode he takes each month, giving him more flexibility in a market where the 2013 demand picture remains unclear.

Spot business remains slow for the moment, which has kept AMM’s copper premiums in a range of 5 to 6.5 cents per pound.

"It continues to be quiet. We’ve seen no real change in business in the U.S. in particular for 2013 over the past couple of weeks. There’s very little buying. Our phones aren’t ringing," a third trader said.

Consumers confirmed that the market has been quiet but noted that it was still early in the year, and business doesn’t usually pick up until spring.

"There’s not much now, but it’s still kind of early," the second consumer said.

However, not everyone expects demand for copper to increase this year. "We’re expecting demand to be off in 2013," a third consumer said.