US Copper & Zinc demand likely to rise on recovery in housing market: Barclays
Wednesday, 06 February 2013 | 16:30
Copper and zinc demand in United States is expected to witness an up-tick trend in 2013-14 as a result of ongoing recovery in the US housing market.
Improvement in the US housing market and recovery in global economy could boost demand for base metals, stated a recent market outlook by London based Barclays.
According to the 2013-14 US housing market outlook, housing starts would average 1mn units in 2013 and 1.2mn in 2014. This robust recovery trend in US construction activity would likely benefit copper and zinc.
[The activity is likely to benefit copper and zinc most of all, given that they possess the highest leverage to this sector in their US refined demand compositions, representing close to 50% for zinc and 44% for copper, compared with, for example, 13% for aluminium.]
Close monitoring is requires if base metals start out performing in 2013-14, noted Barclays.
Meanwhile, China's growing appetite for metals is likely to support the prices of base metals in 2013-14. Massive power grid expansion projects, strong growth in electronic industry are likely to drag the demand for base metals especially copper and zinc.