LONDON, May 5 (Reuters) – Copper prices rose to a fresh 10-year high on Wednesday, topping $10,000 per tonne for only the second time this decade as the world’s largest economies showed signs of recovery, boosting demand hopes.
Benchmark three-month copper on the London Metal Exchange (LME) was up 0.2% at $9,990.50 a tonne in official trading after touching $10,040 in early trade.
That was copper’s highest level since Feb. 2011 when the contract hit a record high of $10,190 a tonne. It hit $10,008 last Thursday.
“There’s a lot of macro forces aligned that (are) together pushing (up) the whole commodities sector,” said ING analyst Wenyu Yao.
“Investors have been increasingly focusing on reopening and recovery, and especially the U.S. economic outlook is getting better.”
The U.S. economy is growing at its fastest rate since the early 1980s, while British manufacturing activity grew at its quickest in almost 27 years last month.
Saxo Bank analyst Ole Hansen however questioned whether immediate copper demand was enough to justify prices at these levels, warning that consumers could pause buying while they adjust to the higher prices.
POSITIONING: Speculators raised their bets on prices climbing for a ninth straight day, with the net long in LME copper at an almost two-month high of 41.7% of open interest, according to brokerage Marex Spectron.
Net long positions on the CME’s copper contract rose to 55,515 contracts, the highest since March 9, according to the latest Commitments of Traders Report.
INVENTORIES: LME copper stocks fell to 132,775 tonnes, their lowest since March 29.
CHILE: Chile’s National Mining Society has warned that a royalty project being discussed in Congress proposes levels of taxation that are “akin to expropriation” and would paralyze investment in the world’s top producer of copper.
SMELTING: The copper price rally spurred a rebound in global smelting activity in April from the lowest levels in at least five years in the previous month, data from satellite surveillance of copper plants showed.
OTHER PRICES: LME aluminium gained 0.5% to $2,439.50 a tonne, zinc was down 0.5% to $2,952, and lead inched up 0.1% to $2,201.50 while tin and nickel rose 2% to $29,550 and $18,013 respectively.