By Chris Kelly
NEW YORK (Reuters) - Shipments of copper into theUnited States rose for a fourth straight month in July to theirhighest levels since March 2009, signaling stronger domesticdemand and a healthier outlook for the world's largesteconomy.
Data from the U.S. International Trade CommissionThursday showed July copper imports climbed to 66,008 tonnesfrom 61,590 tonnes in June. The July figures werethe highest since 79,975 tonnes were taken in in March, 2009.
It was the fourth straight month of import growth for themetal used primarily in construction and electricalapplications, reflecting a strong physical market in the faceof persistent jitters about the global economy, analysts said.(Graphic: http://link.reuters.com/mes52p )
"I think this is another indication of U.S. demand beingunderestimated," said Bill O'Neill, partner of LOGIC Advisorsin Upper Saddle River, New Jersey.
"Base metals are telling us no double-dip. The problemswith unemployment and housing are still very much with us ... Ithink copper for a while has been telling us that maybe thingsare a little bit better," he said.
Since hitting a July low at $2.88 per lb, the benchmarkcopper futures contract traded at the COMEX metals division ofthe New York Mercantile Exchange has rallied more than20 percent to a four-month peak earlier this week at $3.5345.
The rising trend in U.S. copper imports reinforced a recentbullish outlook for the metal from Freeport McMoRan Copper &Gold Inc's Chief Executive Officer Richard Adkerson.
During his company's second-quarter conference call,Adkerson said the day-to-day copper markets around the worldwere "stronger than we've seep them in some time".
That physical market strength helped tip the global coppermarket into a production deficit of 190,000 tonnes during thefirst five months of the year, according to the InternationalCopper Study Group (ICSG).
"The basic growth picture is still very much with us, withgood demand from Asia," LOGIC Advisors' O'Neill said.
Chinese copper imports soared in August, a sign ofpotential stronger domestic demand in an economy that is amajor driver of global growth.
China is the world's largest consumer of copper.
While Asian demand growth will continue to lead the way,analysts said U.S. stimulus measures should help domesticdemand recover.
"The stimulus is being reflected in the copper numbers,"said Larry Young, president of Covenant Trading LLC inChicago.
"Plans are going forward that will require more copper."
President Barack Obama proposed a six-year $50 billioninfrastructure plan to revamp highways, rails and airportrunways in an effort to create more near-term jobs and improvethe long-term U.S. transportation network.
"This is a very good sign for the second half of the yearand an even better sign going into the first quarter, firsthalf of next year," said Sterling Smith, an analyst for CountryHedging Inc. in St. Paul, Minnesota.
"It means you will have manufacturing moving and moneymoving in the economy ... the good ISM manufacturing number aweek ago helps to confirm this," he said.
U.S. manufacturing expanded for a 13th straight month inAugust, calming fears of a double-dip recession. (Reporting by Chris Kelly; Editing by David Gregorio)