Nov. 5 (Bloomberg) -- Copper rose for a second day in London and New York, reaching a 28-month high after workers planned a strike for today in Chile, the world’s largest producer of the metal.
The strike at Collahuasi, the world’s fourth-largest copper mine, will start at 7 a.m. New York time, union official Jacqueline Cerda said yesterday. Inventories of copper in warehouses monitored by the London Metal Exchange have declined 27 percent this year, signaling demand already exceeds supplies. Stocks fell to a 2010 low on Nov. 3.
“Coming on top of an already tight market, the strike news just adds to the potential for higher copper prices,” said David Thurtell, an analyst at Citigroup Inc. in London.
Copper for delivery in three months climbed $76, or 0.9 percent, to $8,675 a metric ton at 10:05 a.m. on the LME. Futures for December delivery advanced 1 percent to $3.9515 a pound on the Comex in New York. Prices touched $8,769.50 and $3.9955, the highest since July 3, 2008.
LME copper may reach $9,000 a ton if the strike lasts for a month or two, Thurtell said. The metal rose to a record $8,940 in July 2008.
Collahuasi, owned by Xstrata Plc and Anglo American Plc, accounted for 3.5 percent of global output last year, according to Standard Bank Plc. The mine will continue to operate at full capacity using non-union employees and contract workers, company spokeswoman Bernardita Fernandez said yesterday.
LME copper has jumped 5.8 percent this week, heading for the biggest advance since the week ended July 23. Prices gained as the Federal Reserve said it would spend $600 billion to boost the economy in the U.S., the world’s biggest copper user after China, weighing on the dollar. A weaker dollar makes metals priced in the currency cheaper in terms of other monies.
Aluminum for delivery in three months on the LME climbed 0.7 percent to $2,475 a ton, zinc gained 1.1 percent to $2,540 a ton and lead slipped 0.2 percent to $2,525 a ton. Nickel added 0.4 percent to $24,600 a ton and tin was unchanged at $26,500 a ton.
--With assistance from Helen Sun in Shanghai. Editors: Dan Weeks, John Deane.
November 05, 2010, 6:27 AM EDT
To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net
