LONDON, September 13 -- The London Metal Exchange (LME) copper sideways on Tuesday after recovering by about $100 from last week's low. Concerns about supply cannot stop investors from selling.
One trader said, "There are some fund sales at various times, but there is a solid support around US$3,570 per ton."
Three-month copper MCU3gt rose once to 3,635 US dollars per ton, but fell 20 US dollars in late-night comprehensive trading, reported 3,585.
Another trader said, "I think the overall base metal trend has indicated that last week's downtrend was only a minor correction, giving people a chance to buy. Those investors who haven't bought up have already regretted it."
After the copper fell last week, market traders covered up short positions to attract investment funds and speculators to return to the market.
"The copper will not really abandon the rally...this market is difficult to sell short," said an investment fund source.
**Supply is still a problem**
Copper prices rose by about 30% last year, hitting a record high of $3,725 this month, as the global supply of copper is difficult to meet the demand of buyers headed by China.
But GFMS, a metals industry consulting company, predicts that the recent storms in the southern United States have had a limited impact on the market.
"The rebuilding of New Orleans and the construction of houses for the victims of the nationwide will undoubtedly increase the consumption of basic metals, but the increased use of scrap will have little effect on the demand for primary metals."
However, supply is still a problem.
LME copper inventories rose by 4,250 tons to 75,100 tons, nearly three times the 31-year low of 25,525 tons, but they are still at historically low levels.
**Good news from manufacturers**
Tuesday's major producers reported positive news. Antofagastalt; ANTO.Lgt; forecasted strong future demand. Rio Tinto (RIO Tinto) lt; RIO.AXgt; lt; RIO.Lgt; said that this year's net profit will almost double, Demand is all-encompassing, especially from China.
Other metals are trading quietly.
Three-month aluminum MAL3gt; from the previous day's final quoted price of 1,859 US dollars rose to 1,863. The period of zinc lt; MZN3gt; since 1,419 fell to 1,402 US dollars.
Lead mp; MPB3gt; fell from 871 to 866. nickel lt; MNI3gt; from 14,525 slip to 14,325.
The period of MSN3gt fell from 6,875 to 6,700.