Copper gains on strike, surplus estimate

A new strike, demand from traders, and a report that cut estimates of supply surpluses this year supported copper prices on Tuesday.

December copper added 2 cents to $3.71 per pound in New York, while three-month copper on the London Metal Exchange added $50 to $8,160 per tonne, or $3.70 per pound.

Workers at Southern Copper’s mines in Peru walked off the job over a wage dispute, adding to supply disruptions from other strikes this year in Chile and Mexico.

Total supply disruptions of copper supply due to slowdowns and shutdowns forced by strikes is estimated to be around 330,000 tonnes this year.

In addition to strike news, prices were up on demand from trades who look to historical trends rather than immediate issues such as the housing slump in the US, which has decreased demand for the copper used in home construction.

Meanwhile, the International Copper Study Group reduced its estimate of the year’s supply surplus from 282,000 tonnes to 111,000 tonnes.