Copper rebounds as virus concerns fade

Three-month copper on the London Metal Exchange was up 1%

  

Copper prices bounced on Wednesday as worries diminished that the Omicron coronavirus variant would hit demand for industrial metals.

Three-month copper on the London Metal Exchange was up 1% to $9,535 a tonne by 1125 GMT, having lost 0.6% in November.

A green transformation to electric vehicles and wind turbines plus new infrastructure projects will require more copper even if a spreading pandemic spurs tighter restrictions, said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

"These projects are not going to go away even though we see a dip in growth again or a period of lower mobility," he said.

"Adding to that, inventory levels are still very low and it does seem like copper is being consumed and leaving these major exchange warehouses, which is another layer of support."

Metals benefited from investors' increased risk appetite, which sent stock markets surging, using a dip in prices to bet the latest COVID-19 variant would not derail the economic recovery, while oil also rallied. 

* Chile's Senate pushed forward discussion over a controversial bill to increase royalty payments from mining companies that operate in the world's largest copper producer, a legislation being backed by opposition lawmakers. 

* The Philippines' Berong nickel mine, operated by DMCI Holdings Inc's mining unit, is expected to be fully depleted by year-end and will be decommissioned and rehabilitated, the company said. 

* LME cash aluminium traded at a $9.75-a-tonne premium over the three-month contract, indicating tight nearby supplies, as LME aluminium stocks  fell to a 14-year low of 893,775 tonnes.

* LME aluminium rose 0.4% to $2,636 a tonne, nickel advanced 1.2% to $20,135, zinc added 0.6% to $3,218, lead gained 0.7% to $2,292, and tin  edged up 0.2% to $39,100.

(Additional reporting by Mai Nguyen in Hanoi. Editing by Jane Merriman) ((eric.onstad@thomsonreuters.com; +44 20 7542 7093; Twitter https://twitter.com/reutersEricO; Reuters Messaging: eric.onstad.thomsonreuters.com@reuters.net))


More From Commodities