Monday, January 31, 2011

Why does Copper Bullion cost more than the spot price of copper on the LME

I often get asked why is the price of copper bullion bars more expensive than the spot price of copper on either the London Metal Exchange or the COMEX in New York. The answer is fairly simple, these prices on the exchanges are for METRIC TONNAGE of raw copper. You have to take physical delivery of the tonnage, warehouse, or buy tonnage in the form of warrants. These are not the prices for 50 or even 500 pounds of copper. We specialize in .999 fine copper bullion art bars that are beautifully crafted, hi quality relief stamped, assayed and cut into pound or kilo increments, not metric tons of raw copper. This is the reason for the price over spot.

The following pertains to delivery of copper from The London Metal Exchange:
Delivery against LME contracts is in the form of warrants, which are bearer documents of title enabling the holder to take possession of a specified parcel of metal at a specified LME approved warehouse.  Each LME warrant is for one lot of metal, the tonnage of which is dependent on the contract specification. The front of the LME warrant displays information about the parcel of metal, including its brand, the exact tonnage, the shape and the location.


1 comment:

  1. You are shared the best article it is very useful to know the copper bullion prices. And I read the copper bullion prices of the anthor site so I would consider it is useful to us so I declared that information in this place please read and make use of it. Copper Bullion is not the prices for 50 or even 500 pounds of copper. We specialize in .999 fine copper bullion art bars that are beautifully crafted, hi quality relief stamped, assayed and cut into pound or kilo increments, not metric tons of raw copper.
    It is use full for you?

    ReplyDelete