BLBG; Copper Gains in London on Dollar’s Decline; Aluminum Advances
By Claudia Carpenter
Dec. 10 (Bloomberg) -- Copper led gains on the London Metal Exchange on expectations that declines in the dollar may boost demand for industrial metals.
The dollar fell against a basket of six currencies including the pound and dropped to a three-week low against the euro. The UBS Bloomberg CMCI Index of 26 commodities has dropped 37 percent this year as gold and oil also declined, under pressure from gains in the dollar and slowing growth in China.
“A weaker dollar helps a little bit,” said Andrew Montgomery, U.K. manager of Concorde Metals Recycling Ltd., a Coatbridge, Scotland-based processor and exporter of scrap metals with three warehouses in the U.K.
Copper for delivery in three months rose $45, or 1.4 percent, to $3,245 a metric ton as of 10:14 a.m. on the LME. The benchmark contract has dropped 64 percent from a record $8,940 a ton in July.
Prices in Shanghai gained for the first day since Nov. 27, increasing 1.5 percent on speculation lower interest rates will revive growth in China, the world’s largest user of copper.
Buying interest from China has picked up in the past two or three weeks after being absent since October, according to Concorde Metals’s Montgomery, who has followed the industry for two decades.
Copper inventories rose 1,025 tons to 303,600 tons, the most since February 2004. Of the total increase, 87 percent took place in the U.S., the world’s second-biggest buyer of copper. LME- monitored inventories scheduled for withdrawal, or canceled warrants, increased 1,150 tons to 5,175 tons, signaling supplies may be reduced.
Tin gained $200 to $12,000 a ton. Yunnan Tin Co., the world’s biggest producer of the metal, said yesterday it was suspending output for at least one month.
It’s “probably a reflection of weak demand in China,” Peter Kettle, research manager of St. Albans, U.K.-based producer group ITRI Ltd., wrote in an e-mail today.
Nickel rose $200 to $9,600 a ton, aluminum increased $10 to $1,522 a ton, zinc gained $2 to $1,117 a ton and lead jumped $29.75 to $999.75 a ton.
To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net or ccarpenter2@bloomberg.net
