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Lead Gains as Stockpile Withdrawals Signal Strengthening Demand

By Chanyaporn Chanjaroen

July 9 (Bloomberg) -- Lead gained in London as withdrawals from stockpiles signaled demand may be strengthening.

Canceled warrants, representing metal booked for delivery out of warehouses registered with the London Metal Exchange, jumped 16 percent to 8,450 metric tons, according to today's report. Canceled warrants have more than doubled this week.

``One could argue lead demand has held better than expected,'' Dan Smith, a metals analyst at Standard Chartered Plc, said today by phone from London. ``About 50 percent of lead demand is in replacement batteries, which don't really track the economic cycle.''

Lead for delivery in three months advanced $60, or 3.7 percent, to $1,690 a ton as of 9:35 a.m. on the LME. The contract has increased 7.8 percent this week.

Lead stockpiles gained 1,375 tons, or 1.4 percent, to 101,850 tons today. Canceled warrants now account for 8 percent of the inventory.

Among other metals on the LME, copper added $15, or 0.2 percent, to $8,215 a ton and nickel increased $200, or 1 percent, to $20,820. Tin increased $301, or 1.3 percent, to $22,751. Zinc dropped $45 to $1,810.

To contact the reporter on this story: Chanyaporn Chanjaroen in London at [email protected]
Last Updated: July 9, 2008 05:14 EDT