LONDON: Copper prices rose in London on Wednesday after two days of decline amid signs of limited supply and weaker dollar, making the metal more attractive for buyers with other currencies.
The dollar dipped modestly from three-month highs reached earlier in the day as investors adjusted for the prospect of higher rates for longer after Federal Reserve Chairman Jerome Powell’s comments over Tuesday and Wednesday.
Benchmark copper on the London Metal Exchange (LME) was up 1.6% at $8,903.0 a tonne by 1640 GMT after losing 2.4% in the first two days of the week.
“The copper market is still quite tight on the supply side,” said Dan Smith, head of research at Amalgamated Metal Trading. “Things have been improving in terms of supply from Peru, but the copper concentrate market is still tight.” Mines in Peru, the world’s second largest copper producer, are starting to transport their copper concentrate to ports for export after three months of protests that have snarled shipments, its official told Reuters earlier this week.
Some local communities, however, threatened to start new blockades of the crucial highway used by copper producers in Peru this week.
In another copper producing country, Panama, the government and Canada’s First Quantum Minerals agreed on a draft of contract to operate a key mine. The draft is subject to a 30-day public consultation, but the mine is expected to resume ore processing over the next several days.
LME three-month aluminium rose by 0.2% to $2,354 a tonne. “Aluminium smelters in [China’s southwestern province of] Yunnan are said to have completed necessary production cuts, and we will start to pay close attention to production in the region in the coming weeks,” Sucden Financial wrote in an note about aluminium.
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