Copper prices rose to their highest level in more than three weeks on Wednesday, as strong trade data from top consumer China fuelled hopes of demand revival, although uncertainty about global economic growth kept gains in check. Three-month copper on the London Metal Exchange (LME) closed at $7,419 a tonne, up from Tuesday's close of $7,265 a tonne.
The metal used in power cables and construction rose to an intraday high at $7,480 a tonne, its highest in more than three weeks, having rebounded from 1-1/2 year lows hit at the end of April. China's exports and imports grew more than expected in April, offering the possibility of a better outlook for the world's second-largest economy. Also helping boost sentiment was data showing German industrial output unexpectedly rose in March, beating even the highest forecast in a Reuters poll.
"It's not surprising to see an uptick in prices after the recent sharp falls, especially given the encouraging data," said Ross Strachan, economist at Capital Economics. "But it is too soon to get overly optimistic about demand from China given the high level of inventories there for the likes of copper. There are still structural issues in China and you're unlikely to see rapid acceleration of growth."
China's copper arrivals fell 7.4 percent in April from a month ago to hit a 22-month low, hurt by port strikes in Chile and delays to shipments after the closure of India's biggest smelter. The market was also focused on supplies in India as its Sterlite Industries smelter will stay shut until at least May 14 when an environmental court meets again to review the case, a judge said on Wednesday, prolonging a six-week shutdown that has pushed up copper concentrate processing fees in Asia.
Lead closed at $2,064 from a last bid of $2,026 a tonne and tin closed at $20,745 from Tuesday's close of $20,200. Refined tin shipments from Indonesia, the world's top exporter of the metal, fell 15.5 percent in April to 7,853.09 tonnes from 9,295.7 tonnes in March, a trade ministry official said on Wednesday. Nickel closed at $15,405 from $15,200 on Tuesday and zinc at $1,894 from $1,872.50. Aluminium closed at $1,908 from $1,881.
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