LONDON: Copper prices gained on Monday after stronger-than-expected industrial growth in top metals consumer China, while energy-intensive aluminium surged as a Chinese city clamped down on power consumption.
Volumes were low, with investors cautious ahead of central bank meetings this week.
Benchmark copper on the London Metal Exchange had gained 0.4% to $9,122.50 a tonne by 1700 GMT, off the session high of $9,199.50, the highest since March 3.
“We had some positive Chinese data, which helps to confirm a V-shaped recovery, but volumes are low and there’s no real conviction,” said Geordie Wilkes, head of research at Sucden Financial.
China’s industrial output increased by a forecast-beating 35.1% in January-February from a year ago, suggesting a sharp rebound in the world’s second-largest economy in the first quarter.
But investors were wary ahead of meetings of the US Federal Reserve and other centrals banks this week, Wilkes said.
LME three month aluminium climbed 2% to $2,213.50 a tonne, the strongest since March 4, after the Chinese city of Baotou in Inner Mongolia ordered some industrial production and power plants to shut down in a bid to meet its energy consumption targets for the first quarter.
Aluminium is the most energy-intensive base metal.
China’s aluminium production rose 8.4% in the first two months of 2021 compared with the same period last year, official data showed, as smelters added new capacity and cashed in on soaring prices.
The dollar index rose for a third straight session, weighing on commodities priced in the US currency, making them more expensive for buyers using other currencies.
China’s imports of copper are likely to rebound in March, but the expected increase after a disappointing start to the year may not be quite as bullish as it appears at first glance.
LME zinc gained 1.9% to $2,856, nickel climbed 1.4% to $16,231, lead added 0.4% $1,970.50 while tin fell 1.4% to $25,250.
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