Copper advanced to near the highest level in more than a week amid a shutdown at the world’s second-biggest mine and signs of improvement in manufacturing activity in China, the biggest consumer.
Metal for three-month delivery climbed as much as 0.6 percent to $7,380.25 a metric ton on the London Metal Exchange at 11:43 a.m. in Seoul. Prices yesterday touched $7,397.75, the highest since May 23. Futures for September rose 0.2 percent to 53,090 yuan ($8,667) a ton on the Shanghai Futures Exchange.
Freeport-McMoRan Copper & Gold Inc. (FCX)’s production in Indonesia is shut for a government probe into accidents at its Grasberg mine that may take as long as three months. A tunnel collapse on May 14 killed 28 people and another worker died on June 1 from a separate incident. An official purchasing managers’ index released June 1 in China rose to 50.8 in May from 50.6 a month earlier. Economists had forecast 50, the dividing line between expansion and contraction.
“We remain bullish copper,” said Will Yun, a commodities analyst at Hyundai Futures Corp. “We’ve recently had some signs of improvement that can support demand. Still, there are many others who are skeptical about China’s recovery.”
The suspension at Grasberg, lack of production at Bingham Canyon in Utah and reduced output at Collahuasi in Chile are set to reduce supplies in what is normally a seasonally strong period for demand, said Goldman Sachs Group Inc. The bank expects copper at $8,000 in six months.
On the LME, most of the other base metals including aluminum and zinc declined. Copper for July delivery was little changed at $3.339 a pound on the Comex in New York.
To contact the reporter on this story: Sungwoo Park in Seoul at email@example.com
To contact the editor responsible for this story: Brett Miller at firstname.lastname@example.org