Shanghai copper up

Shanghai copper rose 1 percent on Thursday, after London futures hit a fresh seven-week high and increasing industrial unrest drew attention to tightening supplies. Shanghai September copper ended up 540 yuan at 66,190 yuan ($8,716) a tonne, after easing by 1.2 percent on Wednesday when it snapped a five-day rally.
"Investors in Shanghai are a little cautious about chasing London where prices are being squeezed higher," said analyst Wang Zheng at consultancy Fubao Metals, adding that Chinese spot prices remain subdued. Shanghai spot copper was down 75 yuan at between 64,950 and 65,200 yuan.
"But LME copper seems to be consolidating after breaking up above $7,800 and may now target $8,000," Wang added. Copper for delivery in three months on the London Metal Exchange was up $15 at $7,840 at 0700 GMT, after earlier hitting $7,862, its highest in nearly two months.
The cash to three months spread widened to around a $130 a tonne backwardation, as supplies tightened and a dominant position emerged, with one party holding between 80 and 90 percent of LME warrants, according to latest LME data. LME stocks fell 1,650 tonnes to 110,375, just over two days of consumption. Of the total, 85,000 tonnes are available to the market.
"Strikes continue to underpin sentiment. Allied with the low stocks and dominant position, they give the market significant upside bias," a dealer in Singapore said. Workers at Chile's Collahuasi, one of the world's largest copper mines, rejected a new pay offer from management and plan to strike next week unless the offer is improved.
"There has been a little progress made. We are still in point-by-point discussions," a leading union official, who preferred not to be named, told Reuters. Mexico's miners have planned a 24-hour nation-wide walkout on Thursday unless the labour ministry meets its demands to improve safety in mines.
Elsewhere, strikes rumble on at a large refinery in Canada and at Codelco's copper mines in Chile. The dollar held near a 26-year low against the pound and a two-month trough versus the euro, supporting dollar-denominated commodities. LME lead was up $14 at $2,900, after touching a record high of $2,920 earlier on Thursday.
Shipping delays at the Magellan mine in Australia after a health scare earlier this year and production cuts by Chinese smelters have lifted lead by over 70 percent this year. Tin was down $10 at $14,090, but the market was supported by a strike at Bolivia's biggest tin producer.
Miners at Huanuni, which produces 10,000 tonnes of tin in concentrate annually, have gone on strike and thrown up road blocks to press the government to consolidate the nationalisation of the mine, a union leader and officials said. The strike follows increased tension at the mine caused by a separate protest by several hundred unemployed independent miners, who gathered in the area to demand the government give them new sites to work.