Copper and zinc ended at record highs on the London Metal Exchange (LME) on Monday on fresh fund buying at the start of the second quarter, traders said. "I believe the market will be steady at these levels for a couple of days, perhaps three, as that is the normal pattern for fund managers.
Sellers take a step back in this kind of environment and that takes us only upwards," an LME trader said.
Early short covering after Friday's weak close pushed markets higher and fund buying followed.
Three-months copper closed at $5,615, up $225 from Friday's kerb close. Copper peaked at a record $5,616 in the last minutes of open outcry trading.
Copper has risen by around 25 percent this year on fund buying prompted by global inventory declines and supply worries in Indonesia, Zambia, Mexico and Chile.
Striking miners at Grupo Mexico's La Caridad copper mine vowed to continue their walkout on Sunday, a day after employees at a nearby lime plant joined the strike.
With supply disruptions, equipment delays and lower ore grades the copper market was expected to be in a deficit by around 50,000 tonnes in 2006, a Macquarie report said.
"This has major implications for prices. With copper stocks still chronically tight, the continuing delays in the delivery of supply mean we can expect prices to hold at least at current levels through the remainder of 2006," it added.
New money was also directed to zinc, ending the kerb at $2,740 against $2,645. Zinc, usually used as an anti-corrosive coating in galvanised steel production, hit a record high of $2,750. Zinc prices have risen more than 40 percent this year due to a shortage of zinc concentrates amid growing demand.
With the highest trading volume, aluminium made less spectacular gains, ending at $2,520, up $49 from previous close.
Nickel closed at $16,000, the highest since June 2005, against $15,200/15,250, supported by news of massive vandalism of Inco Ltd's Goro nickel project in New Caledonia.
A company spokesman said the damage from the attacks, by a minority group in the local community opposed to the mine, amounted to about $1 million.
Tin was up $125 at the close to $8,380, and lead ended at $1,194/1,196.
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