Copper futures climbed the most in more than three weeks as a shutdown at the world’s second-biggest mine and an unexpected increase in a Chinese manufacturing gauge fueled supply concerns.
Freeport-McMoRan Copper & Gold Inc. said a probe of accidents at its Grasberg mine in Indonesia may halt work for as long as three months. An official purchasing managers’ index released June 1 in China, the biggest consumer of industrial metal, rose to 50.8 in May from 50.6 a month earlier. Economists in a Bloomberg survey forecast 50, the dividing line between expansion and contraction.
“The Chinese numbers were a little bit better than expected, and the mine closure will put a little more tightness in the market,” Harry Denny, a broker at PVM Futures Inc. in Hoboken, New Jersey, said in a telephone interview. “This is a bit more of a sustained shutdown than we’ve seen.”
Copper futures for July delivery climbed 1.2 percent to settle at $3.3305 a pound at 1:13 p.m. on the Comex in New York, the biggest gain for a most-active contract since May 8.
Chinese economic concerns may limit gains in copper, Denny said. Premier Li Keqiang said last week that the government’s reform measures will be accompanied by lower levels of growth.
BHP Billiton Ltd.’s Escondida site in Chile is the largest copper mine.
On the London Metal Exchange, copper for delivery in three months rose 0.4 percent to $7,340 a metric ton ($3.33 a pound).
Nickel rose to a six-week high in London after the Financial Times reported that China’s State Reserve Bureau bought 30,000 tons, equivalent to one-sixth of LME stocks. The newspaper cited people familiar with the transaction.
Nickel gained 2.4 percent to $15,185 a ton. Earlier, the price reached $15,600, the highest since April 17.
Aluminum, tin, lead and zinc also climbed.