Can anyone tell me why copper rounds are so much above spot?

Discussion in 'Commodity Futures' started by peilthetraveler, Aug 4, 2012.

  1. To buy a 1 oz silver round, you pay about 5% above spot.

    But to buy a 1 oz copper round, you pay about 400% above spot.

    Doesnt seem to matter how many copper rounds you buy, you will still pay around 400% above spot for 1 oz coins. So I thought, maybe its because it costs alot to produce a single coin, but when I checked out 10 pound bars, its still more than a 200% markup. Is copper undervalued or something? I wanted to buy about $1,000 worth of 1 oz copper coins, but no way I'm paying the prices they want over spot.
  2. i'd say because those copper rounds are for suckers.

    if you really want a few hundred pound hoard of copper bullion rounds, buy $1,000 worth of pre-1981 cents off ebay.

    yes, people sort the copper cents from the plated cents, and resell the copper ones for anything over .01 they can get, current melt value .022, you can get them for .015, shipped.
  3. I recommend Confederate currency. The markup to spot is much less.
  4. if you can buy the pre 1981 cents for .015 and sell for .022 WITHOUT YOU DOING THE MELTING then have at it but AFAIK melting/defacing us currency is a federal offense.

    to get around the absurd markup, just buy a bunch of cooper wire that electricians use. the quality is pretty high and you won't pay that much of a markup.
  5. pcp198


    The huge premium for copper bullion (bullion = bars or rounds, not scrap wire or unmeltable pennies) made me suspicious as to weather it was really possible to take delivery of the futures contract at or near spot, since anyone who got a hold of copper bars @spot could immediately flip them for 1.5X spot or more.
  6. Here is a completed ebay auction. 100 pounds of 5 pound copper bars for $796. That comes out to $7.96 per pound. Well over
    the $3.36 per pound Copper is going for on spot rate.

    To take delivery of a copper contract you need $84,000. But then you can immediately sell it on ebay for $199,000(you'll have to split the order up into smaller more affordable amounts). Even with ebays & paypals fees and eating the shipping costs, you should still come out doubling your money. Hell, you only need to do one contract per year and you are doing better than the average american.
  7. ===============
    Pt/trend trader;
    Well, it takes all kinds to make a market;
    including those that pay ASKING price, in most any market. Seldom , if ever pay asking /market price to buy-selling thats sometimes wise.

    Copper is in a long term uptrend;
    soif held ''long'' enough the trend may bale them out,LOL:D
  8. Good profit potential but you'd be dealing with 12.5 tons of copper!
  9. Anyone know what the purity of the copper the CME delivers? The contract specs did not say.
  10. Actually I'm not even sure that Comex delivers copper in bullion form, but in cathodes like this. Also LCFX, the cathodes are required to be ASTM specification B115-00, which is 99.97~99.98% purity.
    #10     Aug 7, 2012