By Claudia Carpenter July 23 (Bloomberg) -- Copper declined in London for the first time this week as inventories at a four-week high eased speculation that mining disruptions would limit new production. Other industrial metals rose. Copper inventories in warehouses monitored by the London Metal Exchange rose 1.2 percent to 271,725 metric tons, the highest since June 24. Copper rose to a nine-month high yesterday after Xstrata Plc said there was damage at its part- owned Collahuasi mine in Chile and a union leader said production would probably drop. “There’s still metal around,” said Kevin Tuohy, a trader at MF Global Ltd. in London. Copper for delivery in three months fell $12, or 0.2 percent, to $5,488 a ton by 11:14 a.m. in London. Damage to electrical equipment at Collahuasi, also owned by Anglo American Plc, will lead to reduced output for months, a union leader said yesterday. The company will report on the impact to the mine later, an Xstrata spokeswoman said. Aluminum climbed to a seven-month high on speculation demand from automakers will help to erode near-record supplies. Ford Motor Co., reporting second-quarter earnings today, said June 29 it was boosting third-quarter North American production by 16 percent from a year earlier. A typical U.S. vehicle uses 148 kilograms (326 pounds) of aluminum, Barclays Capital estimates. Inventories of aluminum in warehouses monitored by the LME are heading for the smallest monthly gain in a year this month. ‘Smart Money’ “Demand is picking up,” said David Thurtell, an analyst at Citigroup Inc. in London. “The smart money is looking at that and they’re looking at restocking of inventory by automakers and other aluminum consumers.” Aluminum for delivery in three months rose $5, or 0.3 percent, to $1,750 a ton and earlier gained to $1,765, the highest since Dec. 1. Stockpiles of aluminum fell 1,825 tons today from a record 4.56 million tons yesterday, the LME said in a daily report today. They have climbed 3.5 percent this month, after rising throughout the past year and by as much as 29 percent in December. “You’d expect at this time of year that stockpiles would be tending to build but they’re not,” Thurtell said. “If anything, they’re flattening out.” Lead climbed 1.8 percent to $1,735 a ton and nickel rose 1.8 percent to $16,540 a ton. Tin advanced 1.3 percent to $14,150 a ton and zinc increased 0.9 percent to $1,701 a ton. To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net

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