If you are interested in trading copper futures it is helpful to become familiar with the history of
the copper market. Copper, one of the oldest commodities known to man, is a product with fortunes which directly reflect the
state of the world economy.
Copper is the world's third most widely used metal, after iron and
aluminum, and is primarily used in highly cyclical industries such as construction and industrial machinery manufacturing.
Profitable extraction of the metal depends on cost-efficient high-volume mining techniques, and supply is sensitive to the
political situation particularly in those countries where copper mining is a government-controlled enterprise.
was first worked about 7,000 years ago. Its softness, color, and presence in nature enabled it to be easily mined and fashioned
into primitive utensils, tools, and weapons. Five thousand years ago, man learned to alloy copper with tin, producing bronze
and giving rise to a new age.
By the mid-1800s, Britain, with superior smelting technology, controlled more than
three-quarters of the world copper trade. As the proportion of metal to waste in rock declined, it became economical to position
smelters and refiners adjacent to mining sites and ship the final product directly to market. The discovery, in the 19th century,
of major copper deposits in North America, Chile, and Australia challenged England's preeminent position.
early 20th century, new mining and smelting techniques were developed in the United States which made it possible to process
lower-grade ores, resulting in a dramatic global expansion of the copper market.
Since the 1950s, more often than
not, the copper market has been in backwardation but has gone into contango for significant periods of time.
Today, copper ranks third in world metal consumption after steel and aluminum. Copper is the best non-precious metal
conductor of electricity. In addition, copper's exceptional strength, ductility, and resistance to creeping and corrosion,
makes it the preferred and safest conductor for building wiring. Copper is also used in power cables, and low voltage applications.
Copper is also an essential component of energy efficient motors, transformers and automobiles.
Copper market participants
across the board use COMEX Division high-grade copper futures and options to mitigate price risk, and the copper contracts
are used as investment vehicles, as well.
NYMEX Metals Complex
Click on the link above to download a very informative .pdf brochure entitled "Metals
Complex". It was published by the New York Mercantile Exchange. This is a must read guide for any speculator or hedger
considering an trade in the copper futures or copper options.
Click here to contact a commodities broker with experience in the copper market.