Mining Profits...Investing In Industrial Metals

Copper futures in New York ended down on Friday, extending a weekly decline that saw the benchmark contract lose 7 percent of its value as investment money continued to bail out of commodities, sources said.

"It looks like there is just a complete abandonment of commodities right now," said one trader down on the floor of the exchange.

Copper for December delivery settled down 6.30 cents at $3.3115 a lb on the New York Mercantile Exchange's COMEX division, after dealing between $3.373 and $3.2750, its lowest level in one month.

"As soon as we broke through that $3.30 level, everybody was looking for a big gap down to $3.21, but we never made it, only reaching $3.2750, so when guys saw that it wasn't going lower, they started buying back their shorts," said one COMEX floor dealer.

Floor dealers saw the $3.30 level as key short-term support that could "make or break" the market.

"If we break through that level, I see no reason why we shouldn't be trading below $3.10," one said.

Spot September lost 6.55 cents at the close to $3.3165, while the rest of the board ended down 5.90 cents to 0.10 cent.

COMEX final copper volume was estimated at 14,000 lots, almost double that of Thursday's official count at 7,936 lots.

Concerns over the economic outlook in the United States weighed on bullish sentiment as a slowdown in U.S. growth was seen hurting demand for industrial metals.

On Thursday, the International Monetary Fund (IMF) said the global economy was set for another year of strong growth, but warned that rising inflationary pressures and a U.S. economic downturn posed growing dangers.

Reflecting the U.S. slowdown was a Federal Reserve report Friday that showed output at U.S. factories, mines and utilities fell unexpectedly by 0.1 percent in August against analyst expectations of a 0.2 percent rise.

However, tight inventory levels and possible supply disruptions in Chile and Canada continued to support the market.

Unionized workers at Teck Cominco Ltd.'s Highland Valley copper mine in British Columbia voted overwhelmingly in favor of a strike mandate, the union said on Friday.

Also, workers at Chile's Spence copper project, owned by Anglo-Australian mining giant BHP Billiton, said Thursday they will vote on strike action after the company failed to meet salary demands.

London Metal Exchange copper warehouse stocks fell 2,525 tonnes to 121,000 tonnes on Friday -- less than three days of global usage. COMEX stocks slipped 1,568 short tons to 14,180 tons in Thursday's daily report and stocks monitored by the Shanghai Futures Exchange fell 2,028 tonnes, or 4.3 percent, at 44,944 tonnes in the week ended Thursday.

Meanwhile, Chile's copper exports jumped more than 75 percent in August from a year earlier, to $2.92 billion, as prices for the metal remain high, according to central bank figures released on Friday.

China imported 40 percent less refined copper and alloyed in the first eight months of the year compared with a year earlier, but imports were expected to rebound in the next three months as fabricating plants increase export production before tax rebates fall.

LME benchmark copper closed down $150 at $7,270 a tonne from Thursday's kerb close.