More news on Chinese smelters
Lead & Zinc Leap on Chinese Supply Restrictions, Copper and Aluminium also rise
Copper for November delivery rose to $6,340/ton on the London Metal Exchange, extending this year’s gain of 107%, similarly in Sinagapore Copper rose 1.5% higher at the end of Friday’s session. Whilst investors will welcome the stronger finish, LME copper prices are still down almost 2% on the week. Should copper markets end today’s session at these levels it will be the first weekly fall in copper prices for seven weeks.
The correction at the beginning of the week came as Asian stockpiles rose, prompting lower copper surcharges. Analysts predict that investors may have to wait until late in the fourth quarter or perhaps even the first quarter of 2010 for Chinese buyers to re-enter the physical copper market.
Copper has doubled this year on the London Metal Exchange with double-digit growth supporting the price as western consumption fallen dramatically since 2008.
Investors will be keeping an eye on further economic development throughout Friday afternoon with weekly Shanghai copper inventory data, being followed by US non-farm payroll data due out later in the afternoon. A substantial change in either the Asian supply data or implied changes to demand from the US may trigger late volatility in copper trading.
Elsewhere, other base metals were strong, driven by Lead which jumped to a 16 month high of $2,387/tonne from $2,280/tonne.
Chinese authorities shut down production at polluting Lead smelters due to health concerns in response to recent lead poisoning incidents. The recent closures have forced Lead prices to rise almost 25% in the last fortnight.
These supply restrictions are heavily influencing Zinc prices as many believe the Chinese government may close down zinc smelters too, Zinc peaked at $1,989.75/tonne up $107 on the session.
Speculation surrounding an influx of Japanese buyers, who are said to have agreed to pay premiums of up to $115/tonne for primary aluminium ingots, pushed Aluminium prices up to $1,860.00/tonne.