BLBG: Copper Rises to Highest in Almost Three Weeks on Inventories
Copper rose to the highest in almost three weeks in London on a continued drop in inventories and optimism that the worst of the world recession may have passed, potentially fueling demand for industrial metals.
Stockpiles of copper in London Metal Exchange warehouses fell for a 14th straight day. The recession in the U.S., the world’s second-largest copper consumer, will probably end in the third quarter, according to a National Association for Business Economics survey of economists. Japan’s export slump moderated in April, helping the country post an unexpected trade surplus.
“The recovery at the moment is looking increasingly V- shaped,” Brock Salier, an analyst at Ambrian Partners Ltd. in London, said by phone, adding that prices might climb further on demand supported by metal users’ rebuilding of inventories. “There are a lot of positive signals out there,” he said.
Copper for three-month delivery rose $50, or 1.1 percent, to $4,710 a metric ton at 10:21 a.m. on the LME. The contract climbed as high as $4,725, the highest intraday price since May 8. Copper futures for July delivery added 0.3 percent to $2.1470 a pound on the New York Mercantile Exchange’s Comex division.
Stockpiles of copper in LME-monitored warehouses fell 2.2 percent to 319,275 tons today, the lowest since December. Inventories have shrunk more than 40 percent from a peak at the end of February as China bought metal for stockpiles. Copper has climbed 53 percent this year on the LME, the most among the exchange’s main industrial metals.
Aluminum Slips
Shanghai copper stockpiles declined 11 percent to 30,217 tons, falling for a second week, the Shanghai Futures Exchange said in a report on its Web site.
Among other LME metals for three-month delivery, aluminum fell $9.50, or 0.7 percent, to $1,442.50 a ton. Inventories of the lightweight metal rose 0.2 percent to a record 4.21 million tons today.
“Recent fundamentals, price patterns and seasonal trends are clearly indicating further short-term weakness in prices,” Laredo, Texas-based researcher HARBOR Intelligence said in a report yesterday. Prices bottomed in February and might rally toward between $1,800 and $2,000 a ton by the end of the year, the report said.
A drop in Japanese shipments of aluminum rolled products slowed in April from March as demand from beverage-can makers increased. Supplies to the domestic and export markets fell 31 percent from a year earlier to 137,718 metric tons, the Japan Aluminium Association said today.
Three-month nickel advanced for a third day, gaining $350, or 2.6 percent, to $13,750 a ton. The stainless-steel ingredient rose as high as $13,900, the highest intraday price since Oct. 8. Stockpiles in LME warehouses fell for a second day to 108,642 tons and the lowest since April 28.
“The end of destocking is driving this,” Ambrian’s Salier said.
Tin climbed 2.5 percent to $13,984 a ton, and lead rose 0.6 percent to $1,453 a ton. Zinc gained 0.3 percent to $1,504 a ton.
