MARKET TALK: Copper Prices Likely To Fall 30% In 2H 2007 - ML

LME copper price likely to fall about 30% in 2H07 to average price of $4,630/ton, despite strength in Chinese demand at the moment, says Merrill Lynch's Alexander Latzer. LME 3-month copper last at $6,554/ton, down $51 on London Friday PM kerb. Copper price's rally to 2007 high last Friday at $6,620 largely due to seasonal pick-up in demand reflecting Chinese restocking, post-Lunar New Year buying, as well as northern hemisphere building and construction. However, demand from U.S. building, construction sector likely to disappoint, copper market to be oversupplied in 2007 by 466,000 tons, prices well above costs - industry average estimated at around $2,645/ton.