Tin hits record high at $32,950

Copper rose about 2 percent to its highest in a month on Friday as market sentiment improved with investors focusing on expectations of increasing demand.

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Copper rose about 2 percent to its highest in a month on Friday as market sentiment improved with investors focusing on expectations of increasing demand.

Amid a broad rally in the metals complex, three-month tin on the London Metal Exchange hit a record high of $32,950 a tonne, lead a three-year high of $2,861.75 and aluminium its highest since September 2008 at $2,708.50 a tonne.

Three-month copper on the London Metal Exchange was $9,839.75 per tonne at 11:52 SA time, up from a close of $9,670 on Thursday, when it shrugged off another powerful earthquake in the north-east coast of Japan.

Earlier, it touched its highest in more than a month at $9,869.50 a tonne, getting closer to a record high of $10,190 hit on Feb.15.

“Positive sentiment is feeding through. Technical levels have been broken. A weaker dollar is also supporting copper,” said Daniel Major, analyst at RBS.

“Investors' money is coming back into the sector after a risk aversion period.”

Violence in Libya, political unrest in North Africa and the Middle East, and March 11th earthquake and tsunami, followed by a nuclear crisis in Japan had hit consumers confidence and affected commodities perceived as risky such as base metals.

But now investors are betting once again on industrial metals, looking at expectations of high demand growth and supply deficit for metals such as copper.

A weaker U.S. dollar was also supporting industrial metals.

The euro rose to a 15-month high against the dollar on Friday, staying well-supported in the wake of a euro zone rate hike, while the prospect of a U.S. government shutdown pushed the dollar lower across the board.

CHINESE DEMAND

Inventories of copper on the London Metal Exchange rose 1,800 tonnes to 444,175 tonnes, their highest since July 2010, latest data showed.

A relentless growth since mid December raised some concerns about waning demand.

However, a 4.8 pct fall from last Friday in copper inventories in warehouses monitored by the Shanghai Futures Exchange eased some concerns.

“We have seen a decent outflow of stocks in Shanghai. It would suggest that post Chinese New Year buyers are coming back into the market,” Major said.

Inventories of aluminium in Shanghai fell slightly this week and on the London Metal Exchange fell 2,700 tonnes to 4,581,775 tonnes, latest data showed.

The outlook for the metal used in packaging and transport remained positive, analysts said.

“Aluminium demand is not unlikely to grow at the same rate as last year, 20 percent. Even though last year is was growing

from a very low base,” Major added.

Aluminium was at $2,707 from $2,672 and battery material lead was at $2,850 from $2,790.

Tin was at $32,823 from $32,550 while zinc, used in galvanizing was at $2,499 from $2,453 Thursday's close.

Nickel was at $27,510 from $26,800. - Reuters

Source: http://www.iol.co.za/tin-hits-record-high-at-32-950-1.1054312

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