``Stocks have now fallen below the 50,000 ton level after taking into account the current level of canceled warrants and this factor alone continues to underpin prices,'' said Robin Bhar, analyst at Standard Bank in London.
Copper Rises for a Second Day as Strike Hits Chile Output
Nov. 24 (Bloomberg) -- Copper in London rose for a second day as inventories fell to their lowest since July 1989. A 20-day strike at Phelps Dodge's El Abra copper mine in northern Chile may deepen the shortage.
Inventories of copper in London Metal Exchange warehouses fell 1,600 tons to 62,350 tons. Only 49,300 tons are on warrant, or available in LME-monitored warehouses, with the rest earmarked for customers.
``Stocks have now fallen below the 50,000 ton level after taking into account the current level of canceled warrants and this factor alone continues to underpin prices,'' said Robin Bhar, analyst at Standard Bank in London.
Copper rose $27, or 0.9 percent, to $3,097 a ton as of 8:37 a.m. in London. It has risen 34 percent this year and stands close to a 15-year high of $3,145 a ton reached on August 10.
Phelps Dodge Corp.'s management at El Abra mine in northern Chile rejected a union proposal to increase bonuses, said Luis Ibaceta, a treasurer at one of two striking unions at El Abra. Workers have blockaded the mine, which accounts for 1.5 percent of the global mine production of copper.
Copper for delivery in January in Shanghai rose 250 yuan, or 0.9 percent, to 29,450 yuan ($3,558) a ton.
Copper demand, led by surging Chinese use of power cables and electrical wiring, will exceed supply from mines and scrapyards by 750,000 tons this year, according to Lisbon-based International Copper Study Group.
Record Euro
Metals also rose as the euro climbed to a record against the dollar amid speculation the European Central Bank will refrain from attempting to stem the currency's appreciation.
The currency shared by 12 European Union members has gained 1.4 percent since Nov. 8, when ECB President Jean-Claude Trichet said the euro's moves were ``brutal'' and ``not welcome.'' ECB policy makers may refrain from selling the euro to halt gains unless it appreciates a further 4 cents ``in the next few weeks,'' said Kristjan Kasikov, a currency strategist at Calyon.
A weaker dollar encourages investors to hedge bets on non- currency assets such as commodities while making dollar- denominated copper cheaper for holders of other currencies.
In other metals, nickel rose $225 to $14,200 while aluminum rose $20.5 to $1,807. Lead rose $7 to $973 and zinc rose $3 to $1,150. Tin rose $40 to $8,950.
