Copper fell in London for the first time in five days after imports of the metal into China, the world’s largest consumer, slumped for a second month. Inbound shipments of copper and products were 273,511 metric tons in October, China’s customs office said today. That was down 26 percent from the prior month and 4 percent from October 2009. Prices also declined as the dollar strengthened. Lower Chinese imports were “likely the main driver for price weakness today,” said Dan Major, an analyst at RBS Global Banking & Markets in London. Copper for delivery in three months dropped $48, or 0.5 percent, to $8,810 a ton at 9:52 a.m. on the London Metal Exchange. Copper for delivery in December declined 0.7 percent to $4.013 a pound on the Comex in New York. The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, added as much as 0.6 percent. A stronger dollar saps demand for commodities as an alternative investment and makes metals priced in the currency more expensive in terms of other monies. The gauge headed for a fourth straight gain and the highest close since Oct. 27. “Metals had an enormous run last week, and it’s hardly surprising that the market is taking a bit of a breather,” said Steve Hardcastle, an analyst at Sucden Financial Ltd. in London. The LME Index of the six main metals traded on the exchange gained 5.1 percent last week, the most since July. Government Stockpiles Chinese copper imports were the lowest in a year in October. Inventories in Shanghai warehouses increased 21 percent last month. Still, China is unlikely to sell copper from state inventories even as prices gain, Peter Richardson, chief metals economist at Morgan Stanley Australia Ltd., said yesterday in an interview. Copper will lead a rally in industrial metals into 2011 as increased consumption cuts stockpiles and weaker currencies spur investment demand for commodities, according to Richardson. Copper has the “potential to have a structural shortage of supply for longer than any of the other metals,” he said. China told some lenders, including Bank of Communications Co., to increase their reserve ratios by half a percentage point from Nov. 15, a person with direct knowledge of the matter said. The country, which today posted a larger-than-estimated $27 billion trade surplus for October, is intensifying efforts to limit inflation and asset bubbles. Copper stockpiles tracked by the LME fell for a fourth day to 363,950 tons, daily exchange figures showed. Orders to draw copper from inventories, or canceled warrants, gained 6.5 percent to 33,800 tons. Tin for three-month delivery on the LME added 0.4 percent to $27,450 a ton after reaching the record $27,500 touched yesterday. The metal has jumped 62 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of the Congo. Aluminum fell 0.4 percent to $2,460 a ton and nickel declined 0.7 percent to $24,450 a ton. Lead gained 0.2 percent to $2,615 a ton and zinc dropped 0.9 percent to $2,558 a ton. To contact the reporter on this story: Maria Kolesnikova in Moscow at mkolesnikova@bloomberg.net

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