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Hansen: Can you extract a solid return from copper's meltdown?

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November 17, 2015 china, china economy, china economy growth, china equity market, china gdp, china growth, china manufacturing, china outlook, china politics, china slowdown, chinese, chinese economy, commodities, commodities markets, commodities prices, commodities supply, commodity, commodity index, commodity investing, commodity market, commodity markets, commodity outlook, commodity prices, commodity strategy, commodity trade, commodity trading, copper, copper demand, copper falls, copper market, copper price, demand, ecb, ecb action, ecb meeting, ecb news, ecb policy, ecb rate, ecb rate decision, ecb rates, european, european central bank, fed, fed chairman, fed chairwoman, fed meeting, fed policy, fed rates, federal, federal government, federal open market committee, federal policy meeting, federal reserve, federal reserve rate, federal reserve rate hikes, federalreserve, glencore, glencore mining, industrial metals, metals, saxo bank, saxo tv, trading, tradingfloor.com, united states, united states of america, us dollar, us dollar index, us dollar rise, us dollar strength, usa, usd
The price of copper hit a six-year low this week. Saxo's Ole Hansen discusses why China, the world's largest consumer of copper, is partly to blame. As demand falls, it's estimated that copper shipments to China will shrink a further 10% in 2016. 

But Hansen explains that the strong dollar is also impacting commodities like copper. That's likely to increase if the US Federal Reserve hikes rates in December and if the European Central Bank extends its quantitative easing programme.

Although there are signs that copper supply is being reduced by the likes of Glencore, Ole says more needs to be done if the industrial metal is to recover any time soon. But he also acknowledges that the current low price will begin to attract investment interest.