Base metals were softer at Thursday's kerb close on the London Metal Exchange (LME) as profit-taking triggered by news of restarts by a US copper producer weighed on sentiment, analysts and traders said.
"We've seen a general easing in prices on the back of the Phelps Dodge announcement, but the market has been pretty routine today," one LME trader said.
In a conference call US producer Phelps Dodge said it would restart operations contributing 108,900 tonnes to global copper concentrate production in 2004 and around 168,000 tonnes in 2005.
Analysts estimated the company had 220,000 tonnes of annual idled capacity prior to the restarts.
"Prices have fallen, but not by that much - the production restarts served as an excuse to book profits," John Kemp, economist at Sempra Metals said.
"What was interesting was Phelps Dodge started ramping up before they told the market, which begs the question how many other producers are quietly restarting?" he said.
In recent weeks a string of announcements of curtailments and production losses has cost the market up to 250,000 tonnes of lost production and additional losses through industrial action may be just around the corner.
Copper ended the day at $2,454 a tonne, having peaked earlier at a 6-1/2 year high of $2,479.60.
Copper closed on Wednesday at $2,364.
Aluminium was at $1,644, softening from the previous kerb of $1,652.
Analysts have said that raw material and energy shortages, particularly in Asia, were expected to limit output.
"Selling activity by systematic funds and producers was again offset by genuine consumer buying, which makes the current rally particularly robust," Ingrid Sternby, analyst at Barclays Capital, said in a daily report.
Nickel slipped $300 to $14,600, however the market remained edgy ahead of the weekend Falconbridge Sudbury labour contract expiry.
Many expect a strike as the union has made preparations for a stoppage and traders said if the union did walk out prices would arrow higher,
Zinc slipped $10 to $1,030, while lead was $6 lower at $758 as tightness in nearby spreads eased, but traders said harsh winter weather in Europe and North America was supportive to the market as it would increase demand for automotive batteries. Tin was untraded, indicated $10 higher at $6,410/30.
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