Copper rallied to its highest in more than a week on Thursday as supply concerns and a weak US dollar lifted prices, while investors shrugged off data showing a large drop in Chinese imports of the metal last month. Benchmark copper on the London Metal Exchange finished at $9,700 a tonne versus $9,577 at the close on Wednesday.
The red metal, used in power and construction, earlier hit $9,707.75 a tonne, its highest since April 12, after having recovered from one-month lows near $9,200 at the start of the week. Anglo American said floods and heavy rains hampered output in the first quarter, including a 14 percent fall in copper output, reinforcing worries about tight supply, although the London-listed miner stuck to its production targets.
"The underlying supply tensions in copper are still there, which is the main theme (supporting prices)," said analyst Dan Smith of Standard Chartered. China's refined copper imports dropped 43 percent in March from the same month last year due to high stocks and strong international prices, although the figure was a rebound from the holiday-shortened month of February.
"Our US macro guys think that number will surprise on the downside. It could take the market by surprise in terms of being less than people expect," said Standard Chartered's Smith. Sovereign debt issues in Europe and worries over rising inventories in Asia are weighing on copper's short-term outlook, said RBS analyst Daniel Major. Inventories of copper in LME-registered warehouses rose by 2,575 tonnes to 456,275 tonnes, their highest since last June, the latest data showed.
Aluminium powered to its highest level since August 2008 as rising costs of power boosted expectations for the energy-intensive metal's input costs. It now sees aluminium at $2,850 on a three-month horizon, rising to $2,950 in 21 months, from prior forecasts of $2,600 and $2,650. Aluminium ended at $2,745 from $2,730 at the close on Wednesday.
Tin was untraded but bid at $32,700/$32,750, from $32,650 at the close on Wednesday while zinc was at $2,360 and flat from the day before. Lead, which is used to make batteries, slipped back to $2,601 from $2,610 and stainless steel material nickel, was at $26,900 from $26,400.