LONDON: Copper prices rose in London on Wednesday after two sessions of falls due to concerns about the availability of copper concentrate, though a stronger dollar put a cap on gains.
Three-month copper on the London Metal Exchange rose 0.6% to $8,383 per metric ton in official open-outcry trading. Last week’s agreement between global miners and Chinese smelters for lower 2024 copper concentrate treatment and refining charges - the first drop in three years - remained in the market focus.
“We see this news as indicating higher copper prices to come as smelters struggle to secure sufficient copper concentrates restricting their output,” SP Angel analyst John Meyer. China is the world’s top metals consumer.
Copper, used in power and construction, touched a 4-month high of $8,640 a ton on Dec. 1 amid concerns about tighter supply from Panama and then fell to a two-week low of $8,313 on Tuesday as Moody’s issued a downgrade warning on China’s credit rating.
“Fortunately, the market is looking forward with much of the world showing surprisingly strong economic growth,” Meyer said. The US economy grew at a searing annual pace of 5.2% in the third quarter, the highest since it emerged from the COVID-19 pandemic in the fourth quarter of 2021.
The dollar index held near a two-week high on Wednesday, making dollar-priced commodities more expensive for buyers using other currencies.
On the technical front, copper is hemmed in by the 200-day moving average at $8,434 and the 21-day moving average at $8,336. LME aluminium was down 0.2% to $2,156 a ton in official activity, nickel climbed 1.9% to $16,450 while tin jumped 1.8% to $24,425.
Lead fell 0.9% to $2,034 after touching the lowest since June 8 at $2,024 amid growth in daily stocks in LME-registered warehouses. Zinc rose 0.6% to $2,436. Zinc stocks continue to decline after sharp November growth with daily LME data showing net fresh cancellations of warrants at 21,225 tons.
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