Prices of copper, often used as a gauge of global economic health, advanced on Monday on hopes of stronger demand for metals and amid a sustained US economic recovery after data showed an acceleration in hiring in the world’s biggest economy.
Three-month copper on the London Metal Exchange was up 0.5% at $9,427.50 a tonne, as of 0528 GMT, and the most-traded August copper contract on the Shanghai Futures Exchange advanced 0.8% to 68,880 yuan ($10,659.24) a tonne.
US companies in June hired the most workers in 10 months, raising wages and offering incentives to entice millions of unemployed Americans sitting at home, in a tentative sign that a labour shortage hanging over the economy was starting to ease.
“Wage growth tends to lead to strong demand for durable goods, a key sector for the metals markets,” said ANZ analysts in a note.
FUNDAMENTALS
Global copper smelting activity slipped in June after a rebound a month earlier as Chinese plants closed for maintenance while production of nickel pig iron jumped, data from satellite surveillance of copper plants showed.
Chilean miner Antofagasta PLC signed contracts to supply Chinese copper smelters with copper concentrate at treatment charges of around the mid-$50s per tonne in deals covering at least half of next year, sources said.
ShFE aluminium rose 2.9% to 19,235 yuan a tonne, nickel advanced 1.9% to 137,270 yuan a tonne and tin increased 2.4% to 216,600 yuan a tonne.
ShFE aluminium inventories in ShFE warehouses fell to 278,383 tonnes, their lowest since Feb. 10, while copper stocks declined to their lowest since Feb. 19 at 142,520 tonnes.
Meanwhile, copper stocks in bonded warehouses in China rose to their highest since July 2019 at 435,600 tonnes, SMM data showed.