Copper Rises on Concern Mine Supplies Will Trail OutlookMaria Kolesnikova and Luzi Ann Javier
Copper futures rose on concern that supplies from global mines will trail forecasts after companies reported lower output.
Freeport-McMoRan Copper & Gold Inc. is producing at about 50 percent of capacity at Grasberg in Indonesia, the world’s second-biggest source of copper. A company controlled by Rio Tinto Group cut its forecast yesterday for output from Mongolia’s Oyu Tolgoi, and Anglo American Plc halted operations for a day at its largest mine in Chile this week.
Production cuts “are going to be bullish for prices,” Adam Klopfenstein, a senior market strategist at Archer Financial Services in Chicago, said in a telephone interview. “As prices hold below $3, a lot of the miners are going to find that it’s not economically viable to produce copper, if the returns are not going to be there.”
Copper futures for May delivery gained 0.9 percent to settle at $2.993 a pound at 1:20 p.m. on the Comex in New York.
On March 19, the price touched a 44-month low of $2.877 on concern that demand will ebb in China, the biggest consumer of industrial metals.
On the London Metal Exchange, copper for delivery in three months rose 0.8 percent to $6,561.50 a metric ton ($2.98 a pound).
Nickel fell 1.2 percent to $15,710 a ton in London. In two days, the price tumbled 3 percent, the most since Jan. 27.
The metal has advanced 13 percent this year on concern that supplies from Indonesia and Russia will decline.
“Some holders of nickel may have started to deliver back or reduce their position,” Vicky Sanders, the head of analytics sales at Marex Spectron, said in a report. “From a technical stance, prices appear to be in a corrective phase after the recent strong rally.”
Lead, aluminum, and zinc rose in London, while tin fell.