LONDON: Copper extended its record-breaking rally on Tuesday, supported by threats to supply and strong demand, and the trend may run into the long term, analysts said. “I think we are still in the early stages of the bull trend in copper. We have years of strong prices ahead of us,” Barclays Capital analyst Ingrid Sternby said.
Three-month copper futures on the London Metal Exchange (LME) hit a record $7,045 a tonne on Tuesday, climbing more than 3% from Monday. In midday trading copper was at $7,000, up $211 from the previous close. Stocks of the key industrial metal in LME-bonded warehouses were 117,450 tonnes on Tuesday, equivalent to about 2-1/2 days of global consumption. Inventories have fallen from almost one million tonnes in April ‘02.
Copper prices have risen nearly 50% from the start of the year and are up over five-fold from cyclical lows in ‘01, putting pressure on consumers’ cashflow.
Nickel also scored an all-time peak of $20,000 a tonne on the LME on Tuesday, supported by strength in other metals, dealers said. By afternoon, the benchmark three-month futures contract was at $19,900/19,970, up from $19,375 at Monday’s close.
Nickel was underpinned by strength in copper, which leapt nearly 6% on fund buying to $7,230 a tonne on Tuesday, while zinc hit an all-time high of $3,385.
Aluminium was up $26 at $2,754 but Monday’s 17-1/2-year peak of $2,796 was likely to keep a near-term cap on prices. Tin gained $45 at $9,395/9,400. Lead softened $3 to $1,215. Lead stocks in LME warehouses rose by 2,025 tonnes to 14,200 dampening sentiment.
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