Copper rises for second day amid market tightness

BEIJING — London copper prices rose for a second day on Monday, as concerns over supply tightness outweighed weak US manufacturing data and a jump in London Metal Exchange (LME) inventories.

LME copper stocks surged 67% over Thursday and Friday to 186,425 tons after hovering at decade-lows for the first half of this month.

But supply concerns for some metals, including copper, could widen the market deficit, ANZ wrote in a note.

“This leaves little room for replenishing depleted inventories,” ANZ noted.

Production at MMG Ltd.’s Las Bambas copper deposit in Peru could fall “in the near term” due to a month-long road blockade, the company said last week.

DEMAND RESILIENT “Underlying demand has been resilient, as reflected in Chinese imports,” which for unwrought copper and copper concentrate combined were up 12.4% year on year in January-February, ANZ added.

Three-month LME copper ticked up 0.3% to $6,451 a ton by 0517 GMT, after closing up 0.4% in the previous session. The mosttraded May copper contract on the Shanghai Futures Exchange (ShFE) added 0.8% to 49,350 yuan ($7,351.96) a ton.

The spread between the front two ShFE copper contracts, which spiked to a backwardation of over 1,000 yuan a ton on Friday when China said its value-added tax cut would be implemented on April 1, is now in a contango of 140 yuan a ton after the March contract expired on Friday.

Vedanta Ltd. has named metals industry veteran Pankaj Kumar as Sterlite Copper chief executive, amid struggles to reopen its smelter in southern India.

China’s refined copper output in January and February rose by 6.3% year on year to 1.34 million tons. On a daily basis, output was around 22,712 tons, down 16.1% from December.

London nickel and zinc were down 0.1% and 0.2%, respectively, while tin was flat and lead and aluminum inched higher.

US manufacturing output fell for a second straight month in February and factory activity in New York state was weaker than expected.

Russian aluminum tycoon Oleg Deripaska sued the United States on Friday, alleging that it had overstepped its legal bounds in imposing sanctions on him. —