Copper rises on supply worries, tin notches biggest weekly increase in a year

LONDON — Copper rose on Friday and posted its biggest weekly gain since mid-February in response to a weak US dollar and ongoing mine supply concerns, while tin clocked its largest weekly gain in a year.

Three- month London Metal Exchange ( LME) copper ended up 0.40% at $5,934 a ton, charting a weekly gain of 3.50%.

The dollar index was down around 1% last week after the US Federal Reserve on Wednesday signaled a slower pace of monetary tightening than expected. A weaker dollar boosts the buying power of non-US investors.

Striking workers at Chile’s Escondida, the world’s biggest copper mine, are blocking attempts by owner BHP Billiton to renew operations at a major port nearby as the stoppage enters its sixth week.

“How long do these supply problems go on for? You’re losing 150,000-200,000 tons of copper supply every month… ( and) in China, demand for copper concentrate remains strong,” Warren Patterson, commodities strategist at ING, said.

Fixed-asset investment in China, which consumes nearly half the world’s copper, grew 8.90% in January and February from a year ago, largely due to strong property and infrastructure construction.

In the US, factory output increased for a sixth straight month in February, as rising commodity prices boost demand for machinery and other equipment.

Tin ended up 0.60% at $20,275 a ton, its strongest week since that ended March 4, 2016. LME inventory data showed 1,000 tons of tin was booked for delivery out of warehouses, pushing on-warrant or available stocks down by nearly a third. “We should keep in mind the underlying tin market looks tight,” an industry source said. “China’s import of tin concentrates fell sharply in January, possibly pointing to a peak in Myanmar’s mine output. And Peru’s Minsur recently published tin metal production guidance for 2017 well below forecasts.”

Aluminum ended up 0.70% at $1,914. Russian aluminum giant Rusal forecast demand growing by 5% this year and a global market deficit widening to 1.1 million tons.

Zinc ended up 1.90% at $2,882 on expectations the closure and suspensions of big mines will create shortages. ING’s Patterson said there was no sign that mines were planning to reopen.

Lead ended up 2.10% at $2,290 while nickel closed up 0.40% at $10,260. —