• by IPS Correspondents (london)
• Friday, November 18, 1994
• Inter Press Service

LONDON, Nov 18 (IPS) - The London Metal Exchange (LME) had one of its most hectic periods this week, with frantic price leaps boosted by waves of speculative buying.

Copper, aluminium and lead bulleted up to four-year highs Thursday and nickel and zinc crashed their two-year high barriers. The surge started in copper and the other base metals followed in the bow wave of the red metal.

"More of the recent fund and speculative buying sent the copper market soaring, accompanying by a tightness of the cash to three- month 'backwardation'," said London futures brokers, GNI.

It continued that "the rest of the complex looks very strong, with nickel again a star performer", said the brokers.

Copper stocks Friday closed up by 7,700 tonnes to rest at 323,225 tonnes in LME warehouses and this caused prices to dip slightly Friday to close at 2,880 dollars a tonne for cash, 2,827.5 dollars a tonne for three-month.

On Thursday copper closed on the LME at 2,893.5 dollars a tonne, 2,841.5 dollars a tonne for three-month.

On Monday copper closed at 2,781.5 dollars a tonne, 2,751 dollars a tonne for three-month. Tuesday it ended at 2,772.5 dollars a tonne, 2,754.5 dollars a tonne for three-month. Mid-week, it closed on Wednesday at 2,915.5 dollars a tonne, 2,854 dollars a tonne for three-month.

Light metal aluminium experienced a 49,725 tonne withdraw from stocks on the LME Friday bringing stocks to 1,908,175 tonnes.

Higher aluminium prices and a buoyant market for the light metal should not mean that producers be complacent of the danger of restarting idled smelter and mine capacity too early, warned London-based Billiton Metals in a report this week .

The Memorandum of Understanding (MOU) signed in January between western and CIS, mainly Russian producers, has been effective in slashing overcapacity and reducing supply but this must be continued, it said.

"There can be little doubt that the aluminium price today exceeds the wildest dreams of producers at the time of the MOU was agreed in January by representatives of the major aluminium producing countries," claimed Billiton.

© Inter Press Service (2014) — All Rights Reserved. Original source: Inter Press Service

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