London copper prices rose for a second day on Monday, as concerns over supply tightness outweighed weak U.S. manufacturing data and a jump in London Metal Exchange inventories.
LME copper stocks MCUSTX-TOTAL surged 67 percent over Thursday and Friday to 186,425 tonnes after hovering at decade-lows for the first half of this month.
But supply concerns for some metals, including copper, could widen the market deficit, ANZ wrote in a note. “This leaves little room for replenishing depleted inventories.”
Production at MMG Ltd’s Las Bambas copper deposit in Peru could fall “in the near term” due to a month-long road blockade, the company said last week.
“Underlying demand has been resilient, as reflected in Chinese imports,” which for unwrought copper and copper concentrate combined were up 12.4 percent year-on-year in January-February, ANZ added.
FUNDAMENTALS
* COPPER: Three-month LME copper ticked up 0.6 percent to $6,472 a tonne by 0720 GMT, after closing up 0.4 percent in the previous session. The most-traded May copper contract on the Shanghai Futures Exchange closed up 0.8 percent at 49,350 yuan ($7,354.26) a tonne.
* SHFE SPREADS: The spread between the front two ShFE copper contracts, which spiked to a backwardation of over 1,000 yuan a tonne on Friday when China said its value-added tax cut would be implemented on April 1, is now in a contango of 90 yuan a tonne after the March contract expired on Friday.
* VEDANTA: Vedanta Ltd has named metals industry veteran Pankaj Kumar as Sterlite Copper chief executive, amid struggles to reopen its smelter in southern India.
* CHINA: China’s refined copper output in January and February rose by 6.3 percent year-on-year to 1.34 million tonnes. On a daily basis, output was around 22,712 tonnes, down 16.1 percent from December.
* OTHER METALS: London nickel and zinc were down 0.2 percent and 0.3 percent, respectively, while tin , lead and aluminium all crept higher.
* U.S.: U.S. manufacturing output fell for a second straight month in February and factory activity in New York state was weaker than expected.
* SANCTIONS: Russian aluminium tycoon Oleg Deripaska sued the United States on Friday, alleging that it had overstepped its legal bounds in imposing sanctions
