Copper exceeded the $8,000 a tonne mark for the first time since August 2008 as the world’s largest conference on the red metal began in Chile.
Encouraging employment data from the US on Friday and a series of better-than-expected manufacturing reports lifted demand for copper, which is primarily used in electrical wiring and construction.
As trading resumed after the four-day Easter weekend, three-month copper contracts on the London Metal Exchange jumped to $8,009.75. By mid-morning, the metal had pared its gains slightly to trade up 0.9 per cent at $7,952 a tonne.
All eyes in the industry turned towards Chile, the biggest producer of the metal and the location of the CRU/Cesco copper conference.
At the industry’s largest annual meeting, delegates will be debating how high copper prices could rise during the economic recovery.
Industrialists and economists have already voiced concern over a potential correction in the market if Chinese demand begins to falter.
Cesco, Chile’s copper industry think-tank, said: “Economic realities have taken a back seat at least where copper is concerned. Strategic purchases by China’s State Reserves Bureau and consumer restocking have boosted copper price to levels not supported by real demand.”
However, American economic data have lent some support to the market over recent days. The US labour department said on Friday that the country’s economy last month had added the largest number of jobs in three years.
While other base metals rose on the improving macroeconomic picture, precious metals took a battering from the stronger dollar.
After hitting a four-week high in the previous session, spot gold fell 0.6 per cent to $1,125 an ounce.
Meanwhile, oil prices edged lower ahead of the latest inventory data from the US. Stockpiles of crude oil are expected to have grown for the 10th week in the country, the world’s largest energy consumer.
Nymex May West Texas Intermediate was down 27 cents at $86.36 a barrel, while ICE May Brent lost 20 cents to $85.68 a barrel.
