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Copper Commodities Project Ching and Patrick

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Copper Commodities Project

Copper Commodities Project


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  • 1. Copper IB Economics HL C. Fung and P. Theile
  • 2. HISTORY OF THE TRADING OF THE PRODUCT, Chile – 2,350,000 US – 1,890,000 Canada – 740,000 Russia – 600,000 Indonesia – 380,000 Australia – 420,000 Peru – 400,000 China – 350,000 Zambia – 350,000 Poland – 340,000 Kazakhstan – 220,000 Philippians – 115,000 Zaire – 40,000 Where is it produced? (in tonnes)
  • 3.
    • Who manufactures copper?
    • Copper mining companies (eg. Freeport McMoran, Codelco)
    • Where is copper traded?
    • Primarily the London Metals Exchange (LME) ; also the Commodities Exchange Division of the New York Mercantile Exchange (COMEX/NYMEX), and the Shanghai Metal Exchange (SHME)
    • What goods are made from copper?
    • Building construction (eg. Pipes)
    • Electrical and electronic products (eg. Wires)
    • Transportation equipment
    • Industrial machinery and equipment
    HISTORY OF THE TRADING OF THE PRODUCT;
  • 4.
    • 1900: $357.00/ton
    • 2006: $6,939.00/ton
    • Almost 2000% increase;
    • The price of copper has steadily increased since 1900, but experienced a huge price spike in 2006 when the prices of many other commodities rose astronomically (price of oil/barrel $80/barrel - $140/barrel)
    PRODUCT PRICING,
  • 5. PRODUCT PRICING,
  • 6.
    • What conditions are responsible for large fluctuations in price?
    • Change in the economy.
    • Rise in demand.
    • In 2006, most commodities experienced a sudden increase in price due to India and China emerging as world powers and primary users of raw materials;
    • Also, increased and frivolous spending in the United States
    PRODUCT PRICING;
  • 7.
    • Is there an industry group that influences the availability and price of copper?
    • International Copper Cartel (1935 - 1939)
    • Copper producers in South America, Europe and Africa formed the ICC.
    • Aim: Smooth price fluctuations by indirectly influencing prices through supply
    INDUSTRY GROUPS & TRADE AGREEMENTS, “ [To] bring about better conditions in the production, distribution and marketing of copper throughout the world outside of the United States…"
  • 8.
    • Is there an industry group that influences the availability and price of copper?
    • Intergovernmental Council of Countries Exporters of Copper (1967 - 1988)
    • Aim: To get higher copper prices for members
    INDUSTRY GROUPS & TRADE AGREEMENTS; Chile, Zaire, Zambia and Peru formed CIPEC IN 1967 Australia, Indonesia, Papua New Guinea, and Yugoslavia joined later in 1975
  • 9. SPECULATORS;
  • 10.
    • The International Copper Study Group
    • (http://www.icsg.org).
    • Copper Development Association. “The Copper Page”.
    • (http://www.copper.org).
    • Global InfoMine. “Copper Mining”. (http://www.infomine.com/commodities/copper.asp).
    • International Copper Assocation. “Copper Info”. (http://www.copperinfo.com).
    • Callaghan, R. "Minerals Information." USGS. 17 Apr. 2008. U.S. Department of The Interior.
    • Lugaski, Tom. "Where is Copper Mined?" The Modern Copper Industry. 20 May 1997. University of Nevada. (http://www.unr.edu/sb204/geology/modern.html).
    BIBLIOGRAPHY.