Copper prices recoiled in Asia on Monday as investors took profits after hefty gains last week. Dealers said copper would be hard-pressed to retest the highs hit last week amid a stronger dollar and an easing global supply shortfall. Copper climbed to a record high of $3,305 a tonne last week as London Metal Exchange (London Metal Exchange) inventories dwindled. London Metal Exchange-held copper inventories were last reported below 49,000 tonnes, versus a 52-week high of 235,050 tonnes.
Three-months London Metal Exchange copper was last quoted $16 lower at $3,276/$3,386 a tonne, giving back more than half a $27 gain posted on Friday.
"It's inevitable that some profit taking would occur," a dealer said.
Technical support a trigger for commodity traders to buy metal at specified levels should keep copper above $3,250 a tonne, unless selling turns heavy, several said.
Metals were also finding little help from currency markets, where the dollar was up, dampening regional interest.
The euro fell to $1.3256 before recovering to around $1.3266, which is down 0.34 percent from the New York close of $1.3311.
The dollar was trading at 104.90 yen, stronger by 0.23 percent from Friday's New York close of 104.69.
Longer term, there were signs that supplies of copper were mounting despite expectations that China would continue to lap up hundreds of thousands of tonnes of metal to feed domestic demand.
The International Copper Study Group (ICSG) on Friday said the world refined copper deficit would shrink to 93,000 tonnes in 2006 from 259,000 tonnes this year.
Also fuelling perceptions that copper was becoming more plentiful was a smaller-than-expected decline of 3,265 tonnes of copper stocks from the Shanghai Futures Exchange.
Three-month aluminium slipped $8 to $1,990/$1,995 a tonne, after climbing $29 in the previous session.
Three-month zinc was up $2 to $1,393/$1,398 a tonne, showing little reaction to a potential loss of up to 25,000 tonnes of production from Australia's Zinifex Ltd Zinifex, the world's No 2 zinc producer, said on Monday it had suspended shipments of zinc concentrate from its Century mine in Australia due to equipment problems.
The shutdown was due to the breakdown of an ore-grinding mill and will cost Zinifex between 15,000 and 25,000 tonnes of zinc metal contained in the concentrate, or crushed ore. Zinifex uses about half the mine's output for its own smelters.
The rest is earmarked for smelting customers in Asia. "We are working closely with our customers to ensure minimal disruptions to supplies," Zinifex spokesman Martin McFarlane said.
Three-month lead was unchanged at $969/$974 a tonne.
Three-month nickel slipped $5 to $16,250/$16,350. Three-month tin was down $25 at $8,450/$8,500 a tonne.
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