Copper price soars on Chile – by Dow Jones Newswires (The Australian – April 3, 2014)

http://www.theaustralian.com.au/

Copper prices soared before paring early gains to end only slightly higher Wednesday on news of a powerful earthquake off the coast of Chile, as most mining operations appeared to be unaffected.

Copper prices had a roller-coaster reaction to the news over the course of the global day. The 8.2-magnitude quake near Chile, the world’s largest producer of the metal, initially pushed up the three-month copper contract on the London Metal Exchange by more than 1 per cent to $6,728.75 a metric tonne.

The price quickly reversed before spiking again later in the day, as US traders began work, to $US6,734 a tonne, the highest since March 10. LME three-month copper closed the day at $6,680 a tonne, up 0.3 per cent from the previous day’s closing price.

In the US, the most actively traded contract, copper for May delivery, rose as high as $3.0740 a pound before closing up 1.1 cents, or 0.4 per cent, at $3.0455 a pound on the Comex division of the New York Mercantile Exchange. Aluminium prices tracked copper, rising 1.5 per cent on the day to $1,823 a tonne.

“Concerns about China’s economic outlook overwhelmed short-lived fears of supply disruptions following the earthquake,” said analysts at RBC Capital Markets in a note to clients. China accounts for 40 per cent of global demand for copper. Earlier in the week some mixed figures on the manufacturing sector there had resurrected fears of a slowdown in copper-consumption growth.

In the near term, market watchers said copper-price activity would depend on how the mining infrastructure in Chile has been affected by Wednesday’s earthquake.

“Damage to roads and infrastructure may end up delaying shipments from northern Chilean ports,” said Standard Bank base-metals analyst Leon Westgate.

However, it looked like most disruptions had passed toward the close of open-outcry trading in London, and in the Chilean morning the government lifted a tsunami warning.

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