Tin Rises to Highest Since 1989 in London; Copper, Nickel Gain
By Brett Foley and Chanyaporn Chanjaroen
July 30 (Bloomberg) -- Tin rose to the highest since at least 1989 after one
company held as much as nearly half of the stockpiles monitored by the London
Metal Exchange. Copper and nickel also advanced.
One company held between 40 percent and 49 percent of LME- tracked tin
stockpiles as of July 26, according to the exchange's latest data. Tin, the
smallest market among all LME- traded industrial metals, can be influenced by
just one or just a few players, said Eugen Weinberg, an analyst at Commerzbank
AG in Frankfurt.
``The market is seriously in the hands of a few speculative players,''
Weinberg said today in a phone interview. Commerzbank is Germany's
second-largest bank by assets.
Tin for delivery in three months on the LME gained $615, or 4 percent, to
$15,990 a metric ton as of 3:22 p.m. local time.
The metal, used in electronic soldering and cans, has gained 38 percent this
year, outperforming all other metals on the LME except lead. Demand exceeded
supply by 6,700 tons from January through May, the World Bureau of Metal
Statistics said July 18. China is the world's biggest tin producer and user.
Tin's gains were probably because of buying from funds, said analysts
including Robin Bhar at UBS AG in London. Stockpiles of the metal have risen 61
percent to 13,700 tons since the end of April, according to LME data.
Chinese Banks
``Somebody had a pop at it,'' Sean Corrigan, chief investment strategist at
Diapason Commodities Management, said today in an interview in London. ``The
question now is whether they have got enough oomph behind them to sustain
this.''
China, the world's largest user of all the LME-traded metals, ordered banks
today to set aside larger reserves for the sixth time this year to curb lending
and investment after the economy grew at the fastest pace since 1994. The
announcement came nine days after the Chinese central bank increased lending
and deposit rates.
The tightening monetary policy hasn't been enough to slow down the world's
fastest-growing economy and is unlikely to curb demand for metals, Walter de
Wet, head of global commodities research at Standard Bank Plc, said today by
phone from Johannesburg.
Copper added $37 to $7,787 a ton. Stockpiles of the metal fell 1 percent to
101,800 tons, the LME reported today.
Demand for the metal used in pipes beat production by 265,000 tons in the
first four months of the year, the International Copper Study Group said
earlier this month.
`Tight' Supply
The market for concentrate, the raw material processed from ore and shipped
to smelters, ``remains very tight and people are now realizing that there will
not be enough production to meet demand this year,'' Michael Widmer, an analyst
at Calyon in London, said today in a phone interview.
Codelco, the biggest copper producer, said it will resume production today at
its El Teniente mine, the Chilean company's second-largest, after unions agreed
yesterday to return to work. Contract workers have been on strike since June 25
seeking higher pay.
Nickel gained $100 to $30,550 a ton. Earlier, it declined to as low as
$30,300. The metal used in stainless steel traded at a 12-month low of $30,000
on Jan. 9.
LME-tracked nickel inventories rose for a third consecutive session, up 3
percent to 14,100 tons. That's the highest since June 2006. Stockpiles have
more than tripled in the past year.
Lead stockpiles earmarked for withdrawal from LME- registered warehouses
jumped 94 percent to 4,325 tons, according to LME data. The metal to be shipped
out rose nearly fivefold in the past three sessions, from 925 tons reported
July 25.
The benchmark three-month contract fell $45 to $2,925. The contract traded at
a record $3,500 on July 23.
Among other LME-traded metals, aluminum slipped $7 to $2,746 a ton and zinc
rose $11 to $3,481.
To contact the reporters on this story: Brett Foley in London at [EMAIL
PROTECTED] ; Chanyaporn Chanjaroen in London at [EMAIL PROTECTED]
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