Copper price five month high with supply squeeze, high demandA...

Copper price five month high with supply squeeze, high demand

A combination of factors including supply disruption in South America, solid demand in China and dwindling stockpiles are keeping copper prices at a five-month high.Benchmark copper on the London Metal Exchange was up 0.1 per cent at $US5963 a tonne on Monday close to Friday's peak of $US6006.The metal has regained almost all ground lost during the first stages of the COVID-19 outbreak rising 35 percent since March.Copper is used in power and construction and analysts RBC Capital Markets said said the market was starting to exhibit fundamental tightening.They said China appears to be driving demand for copper with key manufacturing indicators like auto sales, grid investment and property completions improving.RBC says a key drive of copper prices in the near term will be impact of COVID-19 pandemic on key copper operations in Chile and Peru.There is also news of tensions between mining corporations and labour unions in Chile."We believe the market is pricing in some supply risk from the region, and this could provide additional upside in the near term," RBC said.Chile's mines minister said copper output could decline by 200,000 tonnes, or 3.5 per cent of 2019 production, as COVID cases rise in the country