[NEW YORK] Mining investment next year will tumble to the lowest level since before the global financial crisis, giving some vindication to long-term copper bulls.

The amount companies spend to expand mining projects next year will fall to US$11.1 billion, the lowest since 2007, from a high of US$33.7 billion in 2012, according to data from Citigroup Inc. Such investment had climbed 15-fold in the 10 years leading up to the record, as demand from China surged and producers encouraged by rising prices expanded output.

This year, so-called expansion capital expenditureswill be down about 50 percent from the 2012 high.

Copper prices slumped for five straight quarters though September, the longest streak since 1996, as slowing economic growth in China fueled concern that production would exceed demand. With output cuts announced by Glencore Plc, Freeport- McMoRan Inc and other producers signaling tighter supplies, the metal has posted two straight weekly gains for the first time in more than three months.

In late August, Phoenix-based Freeport announced plans to cut about 10 per cent of its staff and contractors at US mining operations, while Glencore has said it will close copper mines in the Democratic Republic of Congo and Zambia that account for about 2 per cent of global supply.

Citigroup forecasts prices will average US$5,550 a metric ton in the fourth quarter, up from a closing price of US$5,273 on Tuesday, "with a more constructive outlook for next year," the bank said in a report Oct 13.

BLOOMBERG