Nickel rose to a three-month high in London as stainless steelmakers, the biggest users, stocked up on metal amid signs of recovering economic growth. Copper fell.
U.S. and European stainless steel producers may restock in the first quarter, Goldman Sachs Group Inc. said in a Jan. 24 report. Canceled warrants, or orders to remove metal from warehouses, almost doubled this month, an indication that inventories will start to decline. U.S. consumer spending climbed in December as incomes grew the most in eight year, a Commerce Department report showed today in Washington.
“We might be seeing some restocking by stainless steel mills and consumers,” said David Wilson, an analyst at Citigroup Inc. in London. “It usually happens at this time of year but there hasn’t been much sign of it until now.”
Nickel for delivery in three months jumped as much as 1.1 percent to $18,575 a metric ton on the London Metal Exchange, the highest since Oct. 5, and was at $18,563 a ton by 10:22 a.m. in New York. Nickel rose 8.3 percent this month, leading gains for the six main metals on the LME after being the only one to drop last year.
Copper futures dropped 0.1 percent to $3.7475 a pound on the Comex in New York, trimming this year’s gain to 2.6 percent.
Nickel has climbed an average of 4.4 percent in January for the past 10 years, according to data compiled by Bloomberg.
“You see that in a number of the LME traded metals markets that prices can be stronger in the first months of the year and the standard example is nickel,” said Duncan Hobbs, an analyst at Macquarie Group Ltd. in London. “You tend to see higher output on average in the first and second quarters of the year so people need to buy their materials in preparation for that.”
Aluminum, lead, zinc and tin rose.