Copper hits 2-1/2 year high on upbeat China data

LONDON: Copper powered to a 29-month high on Monday after higher than expected factory output from China reinforced views of solid demand from the world's top consumer of industrial metals.

Three-month copper on the London Metal Exchange was up 2.1% to $7,128.50 a tonne in official trading, after touching its highest since June 14, 2018 at $7,179.

Helped by resilient exports, China's industrial sector has rebounded following a hit from coronavirus, creating robust demand for metals such as copper.

"The strong macro China data is giving copper another ride higher and it reinforces the view that China's demand recovery is holding its shape," said ING analyst Wenyu Yao.

Prices have also been supported by progress in COVID-19 vaccines after Moderna Inc said its experimental vaccine was 94.5% effective, a week after Pfizer Inc's reported its drug was more than 90% effective.

ALUMINIUM: Benchmark LME aluminium hit its highest since March 2019 while Shanghai aluminium climbed to a three-year peak at 15,585 yuan a tonne.

In official trading alumnium was up 0.8% to $1,946.50 per tonne.

"The major consumption in China is holding firm and outweighing the concerns of rising supply," ING's Yao said.

CHINA OUTPUT: China's monthly aluminium output in October rose 9.7% from a year earlier to a record high, official data showed on Monday, as new smelting capacity ramped up to cash in on strong prices.

UNION DEAL: Supply concerns, meanwhile, eased after Chile's Spence copper mine, owned by BHP Group Ltd, said on Saturday it had struck an early deal with its union of supervisors on a contract that will run until November 2023.

Lundin Mining Corp's operation in the South American country said it had offered an improved contract deal to one of two unions on strike at the deposit in a bid to re-start production.

PRICES: LME zinc gained 1.5% to $2,669.50 per tonne, lead rose 0.6% to $1,904.50, tin added 1.7% to $18,710 while nickel climbed 1.2% to $16,083.