Copper rallies on mine supply fears, China's return from holiday

Copper climbed on Thursday as traders bet that Chinese buyers would return once the week-long National Day break ended, with inventories running low. Business Recorder reported that the three-month contract on the London Metal Exchange gained 0.96 per cent to $14,614.5 a metric ton by 0300 GMT. Earlier the metal had touched $14,646.5 a ton, its strongest level in close to two weeks.

Supply worries deepened after workers at Chile's Centinela mine went on strike on Wednesday, after the two unions and Antofagasta Minerals failed to agree. Last week, supervisors at BHP's Escondida mine, the world's largest, turned down a collective contract offer, raising the chance of a strike there too. Shanghai's most actively traded copper contract climbed 1.41 per cent, reaching 111,120 yuan ($16,577.40) per ton.

Zinc on the LME rose 1.22 per cent and aluminium added 0.51 per cent, while lead, nickel and tin traded mixed. On Wednesday, the cash-to-three-month gap on the LME widened to a backwardation of $89.06, pointing to worries about near-term availability. Meanwhile, US traders have been moving copper out of overseas warehouses ahead of a possible tariff on refined imports.