By Laura Clarke
The price of copper on the London Metal Exchange bounced from a
fresh 18-month low Wednesday as bargain hunters lifted the
metal--recently heavily sold by market participants--from a run of
negative daily closes.
At 0904 GMT, LME three-month copper was up 1.5% on the day at
$6,970 a metric ton. In earlier trade the metal had risen above the
key $7,000/ton level to hit $7,053/ton, its highest level this week
so far.
Bargain buyers took the opportunity to pick up the metal at
lower prices after a run of negative closes pushed copper to an
18-month low Tuesday, following similar troughs last week. They
took the lead from stronger equity markets overnight, analysts at
Commerzbank said. Comments from Europe's largest copper smelter,
Aurubis AG, in the previous session also likely improved sentiment
toward the metal.
Aurubis said that the now widely expected 2013 copper market
surplus may be smaller than many market watchers anticipate, as
Chinese processors may be short on copper cathodes if business
picks up and may restock. In addition, extensive maintenance stops
are planned at copper smelters around the globe, which may tighten
supplies, the company said. These factors mean that sustained low
copper prices at current levels are unlikely, Aurubis said.
Elsewhere in base metals, Norilsk Nickel, the world's largest
nickel producer, said Wednesday that it has suspended production at
its Lake Johnston operation in western Australia due to "current
nickel market trends." The LME nickel price has fallen over 18%
since February, dragged lower in the slump that has hit base metals
on concerns of a growth slowdown in China, the top global consumer
of industrial metals.
Norilsk said it will lay off 60 employees. Operations at Lake
Johnston could be re-launched if the market situation improves, the
company said. Comprising a mine and a processing plant, the
facility opened in 2001 and has a capacity of 1.5 million tons of
nickel per year.
Norilsk had sought to sell the mine earlier this year as it
looks to consolidate its overseas holdings, but said it would close
the facility if a buyer couldn't be found. The news may lend prices
some support. At 0915 GMT, LME three-month nickel traded up 0.9% on
the day at $15,259/ton.
Elsewhere, aluminum rose 0.5% on the day, trading at $1,905/ton,
while zinc was 1.2% higher at $1,901/ton and lead was up 1.0% at
$2,035/ton. Tin was up 1.8% at $20,923/ton. Tin is the most thinly
traded LME metal, which can mean that its prices moves are
sometimes exaggerated.
--Lukas Alpert in Moscow contributed to this article.
Write to Laura Clarke at laura.clarke@dowjones.com