Copper may not have put in its low yet, but eventually weaker prices should start to curtail expansion of mine supply and help establish a price floor, says optionsXpress. Comex copper this week hit a four-year low, with optionsXpress citing fears of slower global economic growth coupled with a rally in the U.S. dollar, which has hurt a number of commodities. The red metal also was hurt when the manufacturing Purchasing Managers Index for China, the world’s largest copper-consuming nation, posted its lowest reading in eight months. “While the current outlook for copper prices appears to be negative, current price levels may force producers to begin to limit the expansion of copper mines, which should help to prevent the potential for overproduction in the coming years,” optionsXpress says. “This should help to place an eventual floor for copper prices, but an eventual low may not be put into place for months in the future.” March copper this week bottomed at $2.7775 a pound. On a futures continuation chart, this was the lowest level since June 2010.
