US copper futures charged to record levels on Wednesday as speculative money continued to flow into the market amid a bullish backdrop of supply constraints and robust global demand that showed no signs of easing, sources said.
"There is no end in sight for this market. I think we're looking at $4.00 within a couple of months. We're in a commodity boom right now, with copper the leader from a real fundamental standpoint," said Scott Myers, senior-trading analyst with Pioneer Futures.
The benchmark July copper contract settled 9.20 cents, or about 2.6 percent, higher at $3.6880 a lb, on the New York Mercantile Exchange's Comex division, after dealing from a session low at $3.5950 to a new life-of-contract peak at $3.7040.
Spot May gained 8.80 cents on the day, ending at $3.7840. The session, the front-month contracts rallied to a new all-time Comex record at $3.81. Comex final copper was estimated at 16,000 lots, against the 18,420 lots recorded on Tuesday.
Also, Chile's Los Plumbers copper mine, owned by Antofagasta Plc, said on Tuesday it expected to produce 319,000 tonnes of copper this year, down 4.4 percent from last year.
After the close on Wednesday, the US Federal Reserve lifted US interest rates for the 16th straight time and said it may need to raise rates more to keep inflation risks down in its nearly two-year-old credit-tightening campaign.
As widely expected, the Fed raised its benchmark lending rate by 1/4 point to 5 percent, its highest level since April 2001. "The reality is that a quarter point raise is not going to stem this tide from continuing higher," Myers added.
London Metal Exchange three-months copper peaked at $8,110 a tonne, but finished open outcry trade with gains of 3.2 percent at $8,070, up $255 from Tuesday's kerb close.
LME warehouse stocks rose by 275 tonnes to 115,925 tonnes on Wednesday, while Comex inventories lost 311 short tons to 14,565 short tons on Tuesday.