LONDON: A rally in copper prices towards 10-year highs paused on Tuesday as rising coronavirus infections pulled global stock markets back from record levels, but strong demand and tight supplies are expected to fuel further gains for the metal.

Benchmark copper on the London Metal Exchange (LME) was down 0.8% at $9,298.50 a tonne by 1645 GMT after touching $9,483, its highest since Feb. 25.

“Demand is picking up as we get the second quarter under way,” said independent analyst Robin Bhar.

“That is meeting tight supply and therefore we are seeing some exchange stocks being whittled away ... we could easily go to $10,000 and higher as those stocks dwindle.”

“The treatment charges that refineries demand from mining producers to refine (copper) concentrate have literally collapsed,” Commerzbank analysts said. “This is a clear sign that refineries are having a hard time securing supply ... the concentrate supply bottlenecks are likely to lend further support to the copper price.” After a spike in commodities prices, China’s industry ministry said it would take steps to stabilise and more strongly supervise raw materials markets.

The nickel, lead and zinc markets were oversupplied in February, data from the International Nickel Study Group (INSG) and International Lead and Zinc Study Group (ILZSG) showed.

Global primary aluminium output rose to 5.725 million tonnes in March from a revised 5.187 million tonnes in February, the International Aluminium Institute (IAI) said. LME aluminium was down 0.9% at $2,309 a tonne, zinc fell 1.4% to $2,805, nickel slipped 0.9% to $15,975 and lead was 1.3% down at $2,030 while tin rose 0.5% to $26,840.