Indiana Grain Company, LLC

Posted: 03/01/10

By: tomgrisafi

If you noticed the price of copper unusually jacked up Sunday evening, you weren't alone.

We at Indiana Grain observed the spike as well, a situation engendered by the devastating earthquake that pummeled Chile.

Copper initially rose the most in 11 months after a magnitude 8.8 earthquake halted mines in Chile, cutting supplies from the world’s largest producer.

The May-delivery contract gained as much as 20.3 cents, or 6.2 percent to $3.4870 a pound, the largest intraday gain for the most-active futures since April.

Santiago-based Codelco, the world’s biggest copper producer, is restarting operations at its El Teniente mine after output was halted by the quake, which also closed its Andina mine.

The two projects produce about 600,000 tons of copper.

“We could see prices surge for the next four to six weeks,” says Pete Sorrentino, who helps oversee $13.8 billion at Huntington Asset Advisers in Cincinnati. “This is the kind of thing that feeds on itself. Until we know the full extent of the damage to the mines and the power grid, people will be concerned.”

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