Zinc/copper production and tin!!!, page-2

Copper hits near-three-month high

• AAP
• MARCH 27, 2015 7:47AM

COPPER has hit its highest in nearly three months after mines closed in the world's top producer Chile due to flooding and oil rallied on military strikes in Yemen.

IN early trade, a weaker US dollar also helped to boost base metals on the London Metal Exchange as lead touched the highest in almost two months and zinc hit a one-month peak.

But gains were pared back in the European afternoon as the US dollar rebounded. A stronger dollar erodes commodities priced in the US currency by undermining the purchasing power of buyers paying with other currencies.


Three-month LME copper closed up 0.8 per cent at $US6,174 a tonne after small losses in the previous session. Prices earlier hit their highest since January 2 at $US6,294.50.


Torrential downpours in the north of Chile forced companies to suspend operations at some major mines on Wednesday, putting an estimated 1.6 million tonnes of capacity on hold, although some mines began reopening on Thursday.


"We certainly had thought that forecasts of mine supply were exaggerated, given the industry's long experience with problems such as this," Caroline Bain, senior commodities economist at consultancy Capital Economics in London.


"From our point of view, it certainly underpins our story of being positive on copper prices this year."


Capital Economics forecasts the copper price to extend gains to $US6,500 a tonne by mid-year and $US7,200 by the end of 2015.


Analysts have been whittling down their forecasts for a surplus this year due to declining ore grades, processing problems and bad weather, but clouds over China's growth prospects are still curbing upside price momentum.


"Supply challenges should dominate although the Chinese numbers remain a little bit of a drag on demand," said analyst Dominic Schnider of UBS Wealth Management in Hong Kong.


Reflecting scant buying demand for copper in top user China, Shanghai premiums on a cost insurance and freight (CIF) basis fell $US5 to $US70-$US85.


Also supporting prices was a rally by Brent crude oil, increasing mine costs and spurring buying across the commodities sector by index investors.


Lead closed up 0.4 per cent at $US1,853 a tonne, paring gains after touching $US1,882, the strongest since Jan. 28.


Nickel ended down 0.2 per cent at $US13,680 a tonne, but the other metals failed to trade in closing open outcry activity.


Zinc was bid up 0.4 per cent at $US2,090 a tonne after touching the highest since February 17, aluminium was bid up 0.8 per cent at $US1,788 and tin was bid down 1.4 per cent at $US17,150.

http://www.dailytelegraph.com.au/bu...three-month-high/story-fni0xqe3-1227280617600