London Metal Exchange (LME) zinc touched a fresh record high in pre-market trading on Tuesday on light technical buying, while copper eyed a test of Friday's record peak, dealers said. Zinc was quoted at $2,480/90 a tonne at 1021 GMT, from $2,470 at Monday's close. Earlier on Tuesday, zinc touched a fresh record high of $2,490.
"Zinc technically is likely to test new highs again. It was marked down initially with copper, but when copper turned around zinc firmed up and saw some fresh buying," one LME trader said. He added that volumes were on the low side. Zinc stocks fell 2,400 tonnes to 302,700, of which just 166,525 tonnes was on uncancelled warrant and available for delivery.
Zinc saw support after Australia's Kagara Zinc Ltd said it would have to stockpile ore from its mines in cyclone- damaged Queensland state for up to a week until power is restored to an ore treatment plant, delaying shipments to Korea Zinc Co's Australian refinery.
Dealers said the strength seen in zinc was supporting the rest of the market.
Copper was at $5,120/5,130, up from Monday's close of $5,105 and homing in on Friday's record $5,160.
"There is a lot of volatility which is keeping prices largely sideways...but the fundamentals are in place for the uptrend to continue - if not today, then later this week," Barclays Capital analyst Ingrid Sternby said.
The first trader said: "No one is bearish, that is for sure, but there is a little bit more caution in the air compared to the one-way traffic on Friday."
Aluminium was quoted at $2,496/2,499, from Monday's close at $2,486. In a report, ABN Amro's global head of commodities, Nick Moore, said that International Aluminium Institute data showed that global aluminium production was at an all-time high in February.
"We can now say that reported inventories since end-2005 have already risen 360,000 tonnes to a hefty 3.37 million tonnes, or more than five weeks of concurrent consumption.
"Forget the fantasy; focus on the facts," he said. Nickel was $30 softer at $14,760/810, while tin fell $15 at $7,935/75, but lead gained $3 at $1,178/83.
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