Jojo, Its a long way from the fat lady singing yet mate. Copper Rises on Chinese Growth, Strike Plans; Nickel Gains
By Brett Foley
June 14 (Bloomberg) -- Copper rose for a third consecutive day in London after industrial production unexpectedly accelerated in China, the world's largest user of the metal, and mining workers threatened to strike in Chile. Nickel climbed the most in two weeks and aluminum and zinc also gained.
China's industrial output increased 18.1 percent in May from a year earlier, the National Bureau of Statistics said today, after gaining 17.4 percent in April. That beat the 17 percent median estimate of 19 economists surveyed by Bloomberg News. Contract workers at Chile's Codelco, the world's largest copper producer, plan to strike from June 20, a labor leader said yesterday.
``This kind of production growth is positive for metals,'' David Thurtell, a London-based analyst at BNP Paribas, said in an interview. ``Possible strikes in Chile are also helping.''
Copper for delivery in three months on the London Metal Exchange gained $161, or 2.2 percent, to $7,456 a metric ton. The metal used in power cables and wiring has dropped 11 percent since trading at an 11-month high of $8,335 a ton on May 4.
Inventories tracked by the LME fell for a 19th consecutive day, slipping 0.7 percent today to 119,075 tons, the exchange said. That's the lowest since Oct. 23.
China is boosting domestic copper production to meet rising demand. The world's most populous nation increased copper output 17 percent in May from a year earlier, to 278,000 metric tons, the National Bureau of Statistics said today. That beat the previous record of 274,000 tons in April, according to data compiled by Bloomberg.
The planned walkout by contract workers at state-owned Codelco will hamper the company's output, Cristian Cuevas, president of the Confederation of Copper Workers, said yesterday in an interview in Santiago. The workers are demanding more pay.
New Wage Offer
At Dona Ines de Collahuasi, Chile's third-largest copper mine, workers won't return to talks unless owners Xstrata Plc and Anglo American Plc submit a new wage offer, Pedro Diaz, treasurer of a union, said yesterday.
Nickel rose $1,950, or 4.9 percent, to $41,800 a ton. Earlier the metal used in stainless steel rose as much as 6.3 percent, the biggest intraday gain since June 1. The contract traded at $38,900 yesterday, the lowest since Feb. 22.
Nickel's 14-day relative strength index, used by some investors to gauge price direction, fell to 29.7 yesterday. A reading below 30 typically signals prices may advance. It was the first time the index had fallen below 30 since November 2005. The index was at 38.5 today.
Nickel has lost 19 percent since trading at a record $51,800 a ton on May 9.
Aluminum increased $12 to $2,730 a ton. U.S. primary aluminum production expanded 7.1 percent to 210,271 tons in May from a year earlier, the Aluminum Association said yesterday.
Lead increased $50, or 2.2 percent, to $2,350 a ton. LME- tracked inventories of the metal used in batteries fell 0.8 percent to 42,975 tons, taking this month's decline to 9.7 percent.
Among other LME-traded metals, zinc gained $50, or 1.4 percent, to $3,720 a ton and tin added $25 to $14,025.
To contact the reporter on this story: Brett Foley in London at [email protected]
Last Updated: June 14, 2007 15:59 EDT
MCR Price at posting:
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