BEIJING: Prices of copper opened the week higher on Monday, driven by dwindling raw material supply and investors’ focus on a potential BHP Group-Anglo American deal that would make the world’s largest copper miner.

Three-month copper on the London Metal Exchange added 0.2% to $9,985 per metric ton by 0203 GMT, after hitting a two-year high on Friday.

The most-traded June copper contract on the Shanghai Futures Exchange was up 0.5% to 80,760 yuan ($11,145.31) per ton. Shortages of copper ore and concentrate, triggered by the closure of the big Cobre Panama mine in December, sent the processing fees for copper to negative for the first time last week.

Meanwhile, London copper prices tested a major level of $10,000 a metric ton on Friday after BHP Group’s bid for Anglo American put supply concerns in focus and intensified fund buying.

Copper hits two-year high on fund buying

BHP Group is considering making an improved offer in coming weeks but the group has not yet made a decision on the size and structure of the new proposal, a source familiar with the matter told Reuters on Sunday.

The Federal Reserve’s May 1 policy review is the prime focus for markets this week, with investors already anticipating a delay in its rate cuts after a batch of sticky US inflation and as officials including Chair Jerome Powell emphasise even those plans are dependent on data.

LME aluminium little mvoed at $2,568 a ton, nickel climbed 0.9% to $19,270, zinc increased 0.5% to $2,858.50, tin was 0.2% higher at $32,485, while lead shed 0.2% to $2,203.

SHFE aluminium added 0.9% to 20,685 yuan a ton, nickel slid 0.3% to 142,950 yuan, zinc climbed 0.5% to 22,915 yuan, lead nudged 0.1% up to 17,220 yuan, tin declined 0.6% to 260,080 yuan.