Tigress Cuts Freeport-McMoRan Inc Citing Copper Prices

Freeport-McMoRan Inc's FCX outlook is getting tarnished by a worldwide glut of copper inventory and a slowing Chinese economy, an analyst said Tuesday.

Tigress Financial Partners' Ivan Feinseth downgraded the Phoenix-based mining company to Neutral, from Strong Buy, and said the company's difficulty with the Indonesian government concerning its long-controversial Grassburg gold and copper mine creates additional risk.

Grassburg sits at 14,000 feet in the remote shadow of Oceania's highest peak, the Carstensz Pyramid. It's been the scene of numerous guerrilla attacks, labor strikes, environmental damage and allegedly extensive corruption since the company's mining activity began there in the 1970s.

Freeport recently resumed metals exports from Indonesia following a seven-month hiatus related to new Indonesian rules that require domestic processing.

"We prefer exposure to commodities producers in less risky neighborhoods," Feinseth said in a note Tuesday.

Feinseth said he also prefers companies whose commodities prices are rising and that nixes copper, along with oil, into which Freeport has recently sought to diversify.