COMMODITIES : Copper Surges Over Supply Fears

Prices of copper futures scored sharp gains Thursday on New York’s Commodity Exchange as the market continued to rally on indications of tightening supplies and rising demand.

Elsewhere, precious metals futures were mixed, grains and soybeans retreated, livestock futures were mixed and stock index futures advanced.

The expiration Wednesday of the copper contract for September delivery at an eight-month high of $1.209 a pound made October the spot contract, and traders lost no time in bidding up its price.

Copper for October delivery settled at $1.1735 a pound, up 2.35 cents from Wednesday’s final price. Closely watched December, the most active contract, surged 2.40 cents to $1.0945 and posted a new life-of-contract high for the third straight day.

“There are still concerns about tightness in nearby physical supplies,” said Bernard Savaiko, an analyst with Paine Webber Inc. in New York. “Assuming the majority consensus that we are in a peak consumption period is valid, demand for copper in the coming months should propel the December contract up to the levels of September or exceed it.”

Analyst Craig Sloane of Smith Barney, Harris Upham & Co. in New York noted that the price premium of December over the March, 1989, contract widened to 9.70 cents from 8.45 cents. The widening of this gap, which is known as three-month backwardation, is a key indicator of a tight-supply market.

The September contract expired at a nearly 14-cent premium to December.

Platinum Rises Further

“The tightness that seemed to be suggested by what was taking place in September would seem to be suggested by the December contract as well,” Sloane said.

Platinum futures surged for the second straight day on the New York Mercantile Exchange in reaction to predictions that demand will outstrip supplies during the next five years.

Gold futures retreated and silver advanced in light trading on the Comex. Platinum futures settled $6.10 to $6.40 higher, with October at $500.80 an ounce; gold was $1.80 to $1.90 lower, with October at $396.80 an ounce, and silver was 0.5 cent to 0.6 cent higher, with October at $6.173 an ounce.

Grain and soybean futures posted moderate losses on the Chicago Board of Trade, pressured by selling linked to the accelerating harvest and disappointment in the lack of significant export business.

Wheat settled 3.25 cents to 6 cents lower, with December at $4.1275 a bushel; corn was unchanged to 7.50 cents lower, with December at $2.865 a bushel; oats were 3.50 cents to 5 cents lower, with December at $2.42 a bushel, and soybeans were 4 cents to 8.25 cents lower, with November at $8.08 a bushel.

Pork futures rebounded from Wednesday’s steep losses in a flurry of repositioning before today’s release of the government’s quarterly hogs and pigs report.

Most experts expect the report to show that pork producers scaled back their herd expansion plans and increased their sales of hogs for slaughter because of the summer drought.

Pork Bellies Rise

Cattle futures ended mixed in directionless trading in extremely light volume.

Live cattle were 0.05 cent to 0.20 cent lower, with October at 71.10 cents a pound; feeder cattle were 0.10 cent lower to 0.20 cent higher, with September at 80.22 cents a pound; hogs were 0.43 cent to 0.98 cent higher, with October at 39.47 cents a pound, and frozen pork bellies were 0.88 cent to 1.30 cents higher, with February at 50.32 cents a pound.

Stock index futures were up sharply on the Chicago Mercantile Exchange, where the contract for December delivery of stocks on Standard & Poor’s 500 index leaped 4.15 to 275.70. Each full point is valued at $500.