- Money managers most bearish on copper since January: CFTC data
- Nickel rallies as miners in Colombia vote to strike by June 14
Copper fell, capping the biggest monthly drop since November as a resurgent dollar cut demand for commodities priced in the currency. Nickel rose for a third session as workers at the world’s second-biggest ferronickel mine voted to strike.
Metals slumped in May as Federal Reserve officials including Chair Janet Yellen hinted at higher U.S. interest rates as soon as their June gathering, strengthening the dollar and making materials more expensive in other currencies. Money managers raised their bearish copper bets in the week ended May 24 by 38 percent to the most in four months, U.S. government data show.
“Concerns about the Fed remain and that is keeping investors cautious with regard to copper,” Tai Wong, the director of commodity products trading at BMO Capital Markets in New York, said in a telephone interview. “The prospect of higher rates is making the dollar stronger overall, which weighs on most commodities.”
Copper for delivery in three months fell 0.5 percent to settle at $4,671 a metric ton ($2.12 a pound) at 5:51 p.m. on the London Metal Exchange. Prices lost 7.5 percent this month. The LME Index of six metals slid 6.9 percent in May, the first monthly retreat since January. The bourse was closed Monday for a holiday.
Nickel rallied as much as 1.7 percent on Tuesday. Workers at South32 Ltd.’s Cerro Matoso in Colombia voted to take strike action amid a dispute over negotiations on a wage agreement. Ferronickel is used by stainless-steel makers as an alternative to refined metal.
“The strike may be positive for nickel prices, but there is still a huge amount of metal around,” David Wilson, an analyst at Citigroup Inc. in London, said by phone. “The nickel market will probably be in a deficit this year but you have an inventory overhang.”
In other metals news:
- Investors are awaiting China’s factory activity gauge due Wednesday for further clues on the strength of the top metals user’s economy.
- Copper futures for July delivery dropped 0.9 percent to $2.0955 a pound on the Comex in New York.
- On the LME, lead, zinc and tin gained, while aluminum was unchanged.