Copper rose in London as shrinking Asian inventories of the metal signaled steady demand from the region, which includes top global consumer China. Copper stockpiles in Asia monitored by the London Metal Exchange fell for a 21st session in 22, daily LME figures showed. Regional inventories dropped for a fourth month in September as orders to draw copper from Asian stocks surged more than 24-fold, according to data compiled by Bloomberg. “Fundamentals are holding firm, with physical premiums high in Asia and demand rising in Japan,” Standard Chartered Plc analyst Judy Zhu said in a report today. “Producers report strong orders from Asia. China is buying.” Copper for three-month delivery gained $151, or 2.1 percent, to $7,441 a metric ton by 10:11 a.m. on the LME. Prices plunged 24 percent last month. The metal for December delivery rose 2.3 percent to $3.365 a pound on the Comex in New York. All of the six main metals traded on the LME advanced. Total LME copper stocks fell 0.3 percent to 457,000 tons today, driven by declines in South Korea. Asian inventories dropped 4.3 percent last month as canceled warrants, as the stockpile orders are known, surged to 27,050 tons from 1,100 tons at the end of August. Asian canceled warrants almost doubled on Oct. 4. Chinese Warehouses “There has been additional buying interest from China on each of the corrections we’ve had so far this year,” said Nic Brown, an analyst at Natixis Commodity Markets Ltd. in London. With stockpiles in bonded warehouses in China “now low, it’s finally feeding through into Asian LME warehouses, as can be seen from the recent increase in canceled copper warrants.” Overall canceled warrants slid 5.2 percent to 45,675 tons today. The benchmark Shanghai Composite Index surged 3 percent, the most since October 2010, led by bank shares. The gauge has dropped 14 percent this year as the government raised interest rates and reserve-requirement ratios for banks to cool inflation that’s at the highest level in almost three years. “There are a few signs of a softening of the previously hawkish policy,” Brown said. Copper production is set to fall short of demand by 201,000 tons this year, according to the International Copper Study Group. BHP Billiton Ltd. approved $1.2 billion of spending to expand the Olympic Dam mine in Australia that would more than quadruple production of the metal in 30 years, according to an exchange filing today. Aluminum for three-month delivery on the LME gained 0.2 percent to $2,236 a ton. Alcoa Inc., the top U.S. producer of the lightweight metal, raised its forecast for growth in Chinese aluminum demand to 17 percent for this year, Chief Executive Officer Klaus Kleinfeld said. Usage will exceed supply by 800,000 tons in China, the largest consumer, the CEO said yesterday during the company’s third-quarter earnings conference call. Zinc climbed 2.2 percent to $1,953 a ton and lead advanced 1.7 percent to $2,019 a ton. Nickel gained 1.7 percent to $19,199 a ton and tin rose 1.8 percent to $22,800 a ton. To contact the reporter on this story: Maria Kolesnikova in London at mkolesnikova@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

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