Copper hits two-week high

REUTERS – Copper has hit a two-week high as the market focuses on the likelihood of stronger demand in China, but gains were limited by reduced speculative activity after a spike earlier this week. Benchmark copper on the London Metal Exchange ended up 1.1 per cent at $US4,790 a tonne from an earlier $US4,797, its lowest since October 13. Prices are up more than three per cent so far this week. Copper hits two-week high Traders said copper’s gains this week had been partly due to Chinese speculative activity, which had receded after China’s Zhengzhou Commodity Exchange doubled the charges for intraday trading in thermal coal. China accounts for nearly half of global copper demand estimated at around 22 million tonnes this year. Chinese consumers are expected to import more over coming months due to stronger local demand. “Most people are expecting Chinese copper imports to rebound from the lows we saw in August and September. The domestic copper market is tighter,” said Citi analyst David Wilson. “But copper prices over the next three to six months will stay in a $US4,600 to $US5,000 range.” China’s refined copper imports have fallen over the past three months, slumping 31 per cent in September from a year earlier, partly as China has produced more metal after a surge in concentrate supply from Peruvian mines this year. “Steady demand has contributed to a decline of reported and unreported inventories in China,” Bank of America Merrill Lynch analyst Michael Widmer said in a note. “We see scope for a pick-up of refined imports, which had been at multi-year lows during summer. Having said that, higher domestic refined output, helped by concentrates imports, will in all likelihood subdue refined shipments to China.” Also a plus for copper are stocks in LME-approved warehouses, which at 331,450 have fallen more than 12 per cent since late September. Zinc ended up one per cent at $US2,363 while tin fell 0.2 per cent to $US20,380. Aluminium rose 1.2 per cent at $US1,699, lead slipped 0.1 per cent to $US2,046 and nickel gained one per cent to $US10,360 a tonne.

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