Copper rallies on mine supply fears, China's return from holiday
CPER•LME copper rose 0.96% to $14,614.5 a metric ton by 0300 GMT, after reaching its highest in nearly two weeks, as traders anticipated Chinese restocking and weighed mine supply concerns.
1. Copper prices rise
Benchmark three-month copper on the London Metal Exchange gained 0.96% to $14,614.5 a metric ton by 0300 GMT, after touching $14,646.5, its highest in nearly two weeks. The most-traded Shanghai Futures Exchange copper contract rose 1.41% to 111,120 yuan a ton.
2. Mine supply concerns
Expectations of Chinese restocking after the week-long National Day holiday, low stocks and supply risks supported the rally, CRU principal analyst Craig Lang said. Workers at Chile’s Centinela mine began a strike after talks between two unions and Antofagasta Minerals broke down; supervisors at BHP’s Escondida mine had rejected a contract offer the previous week, creating the possibility of a strike. The LME cash-to-three-month copper spread widened to an $89.06 backwardation on Wednesday.
