Volatile copper market searches for stability in'12

"We have the underlying dynamic in copper that production is not great, thanks to mines that are peaking or past their peaks," the second analyst told AMM. "There are no more large mines that are really going to change the picture until about 2013." For physical suppliers and consumers, copper price volatility has left many hesitant to make too many predictions. As a copper-based business, "your planning is based on what you see from your customers going forward," a second trader told AMM. "We have booked business for a little over a year out. It's hedged business and not a lot tonnage-wise. I think a brass or tube mill can only forecast what they know from their customer base." In terms of premiums, 2012 looks to be much like 2011, market participants said. Premiums should remain at around 4 to 5.5 cents per pound, traders said, and even if demand does not improve, transportation costs should keep them from declining. "We'll be negotiating (our premiums) soon," a source at one wire maker said regarding 2012 premiums. "As for my expectations, I don't think there's much room for them to fall. How much lower can they go?"