Copper flat as traders gauge supply concerns from Chile protests

• Benchmark copper on the London Metal Exchange (LME) was down 0.2% a $5,814.50 a tonne at 0911 GMT, down from Monday's five-week high of $5,868.50.
• Inventories in Shanghai Futures Exchange (ShFE) warehouses at 152,499 tonnes have also risen in recent weeks.
• The dollar was steady but has weakened sharply since the start of October, supporting metals by making them cheaper for buyers with other currencies.

LONDON: Copper prices were nearly flat on Tuesday, as traders gauged the impact of intensifying protests in top producer Chile on supplies.

The union of workers at the world's largest copper mine, BHP's Escondida, said they would hold a day-long strike on Tuesday in solidarity with protests rocking Chile.

Benchmark copper on the London Metal Exchange (LME) was down 0.2% a $5,814.50 a tonne at 0911 GMT, down from Monday's five-week high of $5,868.50.

It was too early to say whether shipments or output from Chile would be disrupted, BMO analyst Kash Kamal said.

A mix of tight global supply and weak demand due to the ongoing US-China trade dispute mean prices are likely to keep bouncing along near current levels, which are around 20% down from last year's high, he said.

FUNDAMENTALS: The copper market was in a 220,000-tonne deficit in the first 6 months of the year compared with a 177,000-tonne deficit in the same period in 2018, the International Copper Study Group (ICSG) said.

ANGLO: Anglo American on Tuesday lowered its full-year copper production forecast to 630,000-650,000 tonnes as it grapples with a water shortage in Chile.

STOCKS: On-warrant copper stocks available to the market in LME warehouses rose 8,950 tonnes to 189,525 tonnes -- around average levels in recent years.

Inventories in Shanghai Futures Exchange (ShFE) warehouses at 152,499 tonnes have also risen in recent weeks.

COPPER TECHNICALS: Copper hovered around its technically important 100-day moving average at $5,830.

TRADE WAR: China and the United States have achieved some progress in their trade talks, Vice Foreign Minister Le Yucheng said on Tuesday.

DOLLAR: The dollar was steady but has weakened sharply since the start of October, supporting metals by making them cheaper for buyers with other currencies.

NICKEL: Benchmark nickel was down 0.2% at $16,075 a tonne after touching $16,045, the lowest since Aug. 29.

STOCKS: On-warrant stocks in LME-registered warehouses fell 11,424 tonnes to 29,130 tonnes, the least since September 2007.

SPREAD: The premium for cash nickel over the three-month contract fell to $20 from a 12-year high above $200 at the start of October, pointing to increased supply of nearby metal.

LEAD: LME lead was up 0.3% at $2,217 a tonne after reaching $2,220, the highest since mid-July.

STOCKS/WARRANTS: Headline stocks in LME warehouses at 69,025 tonnes are close to decade lows and one entity holds between 80% and 89% of warrants.

SPREAD: The premium for cash lead over three-month metal has risen to $21.50, far above usual levels, suggesting low availability of nearby material.

FUNDAMENTALS: A deficit is feeding lead's rally, but there are surpluses on the horizon.

OTHER METALS: LME aluminium was down 0.4% at $1,723 a tonne, zinc was up 0.3% at $2,481 and tin was down 0.3% at $16,720.