The most-traded January copper contract on the SHFE stood at 54,520 yuan ($8,292) per tonne as of 02:17am London time, up by 180 yuan from Friday’s close, with around 103,000 lots traded so far. Open interest of the contract was around 168,000 positions, down 1,100 positions from Friday’s close.
Copper prices continue to be supported by news of industrial action in Peru and Chile that began last week.
On November 22, strike action at Southern Peru Copper Corp escalated with union workers blocking a company-owned train line used to transport concentrates from its mines to the smelter.
“Workers at Southern Copper remained on strike on Friday, with company smelters now having to operate on stockpiled ore and concentrate to keep producing. Despite striking workers blocking the railway line to the smelter, the rest of the operations are running at about 70% capacity,” ANZ Research said on Monday.
On November 23, union workers at the Escondida copper mine in Chile began a 24-hour strike in response to the mine laying off about 120 workers following a review of its operations.
“BHP (which operates Escondida) says the mine is running normally however plants are running at reduced rates,” ANZ Research added.
Meanwhile, declining stocks have also given copper prices a fresh boost this morning.
London Metal Exchange stocks fell a net 5,475 tonnes to 213,600 tonnes on Friday, with stocks falling a net total of 27,800 tonnes in the week to November 27.
“On the supply side, the strikes at Escondida copper mine and Southern Peru Copper will lead to a supply shortage and the falling LME copper inventories will bolster copper prices further,” China’s Citic Futures Research noted.
Market focus will be in Shanghai this week for the Cesco Asia Copper Week where spot copper concentrate treatment and refining charges negotiations will take place.
Metal Bulletin’s spot copper concentrate index settled at $85.90 per tonne and 85.9 cents per lb on November 15, down by $3.30 per tonne and 3.3 cents per lb compared with two weeks earlier. Nickel subdued on weaker demand
Lead stronger; rest of complex under pressure
Currency moves and data releases