Copper capped the biggest gain in almost four weeks after workers rejected a wage proposal at BHP Billiton Ltd. (BHP)’s Escondida mine, the world’s biggest source of the metal.
Plant and mine-shift workers “unanimously” rejected the proposal on Dec. 22, according to their union. A failure to reach an agreement may strain world supplies next year as workers can legally go on strike once the deadline for compulsory negotiations expires on July 31. Chile is the largest copper-mining nation. Prices are up 4.7 percent this year.
“Any negative headlines from Chile will push investors in just one direction, higher copper prices,” Nikolay Sosnovsky, an analyst at VTB Capital in Moscow, said by telephone. “If there’s a strike, financial investors will take it positively because production problems will push contract prices up.”
Copper futures for March delivery climbed 1.5 percent to settle at $3.5975 a pound at 1:11 p.m. on the Comex in New York, the biggest gain since Nov. 29. The exchange was closed yesterday for the Christmas holiday.
The London Metal Exchange, which accounts for more than 80 percent of global metals trading, is closed for Boxing Day.
BHP’s Escondida mine accounts for about 6 percent of the world’s mined copper supply. The mine’s workers went on a two- week strike last year in a protest over bonus payments and working conditions.
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