Bloomberg News

Industrial Metals Surge Most in Three Years on Europe, China

October 24, 2011

Oct. 24 (Bloomberg) -- Industrial metals in London jumped the most in three years, led by copper and nickel, as European governments moved closer to containing the region’s debt crisis and manufacturing rebounded in China, the world’s top consumer.

European leaders outlined plans to aid banks and ruled out borrowing unlimited amounts from the European Central Bank to boost a rescue fund. Chinese manufacturing may expand in October, ending the longest contraction since 2009, according to a preliminary purchasing-managers’ index.

“Most markets seem to be relieved by the progress made over the weekend by European leaders,” Edward Meir, a senior commodity analyst at MF Global Holdings Ltd. in Darien, Connecticut, said in a report. Industrial metals are “also teeing off somewhat disproportionately” on Chinese manufacturing, he said.

On the London Metal Exchange, an index measuring copper, aluminum, nickel, lead, zinc and tin rose 5.9 percent to 3,433.6, the biggest gain since Oct. 29, 2008. The gauge has jumped 11 percent since touching a 15-month low of 3,096.8 on Oct. 20.

Copper for delivery in three months rose 6.9 percent to $7,635 a metric ton ($3.46 a pound) at 6:15 p.m. local time on the LME, the biggest gain since Jan. 26, 2009.

Imports of refined copper by China in September rose 17 percent to 275,499 metric tons from August, customs figures showed today. Shipments were up 14 percent from a year earlier.

‘Waiting for Pullback’

LME copper prices slumped 26 percent in the three months ended Sept. 30 on concern that Europe’s debt crisis would cripple the global economy, curbing metal demand.

“Chinese consumers have been running hand-to-mouth for more than a year, waiting for the price pullback, which has finally come,” David Thurtell, the head of metal research at Citigroup Inc. in Singapore, said in a telephone interview.

Nickel jumped 6.4 percent to $19,995 a ton in London, the biggest gain since Oct. 3.

Zinc climbed 3.9 percent to $1,875.50 a ton. Mines in Hunan and Inner Mongolia, China’s leading producing provinces, are starting to cut output, according to Macquarie Group Ltd. Prices slumped 21 percent in the third quarter.

Aluminum rose 4.4 percent to $2,218 a ton, the biggest gain since July 2009.

Lead advanced 5.4 percent, capping the biggest two-session rally since March 2009. Tin climbed 4 percent.

Copper futures for December delivery surged 7 percent to close at $3.449 a pound on the Comex in New York.

Caterpillar Inc., the world’s largest construction- and mining-equipment maker, posted higher-than-expected third- quarter profit and sales and said 2012 revenue will gain as the U.S. and global economies improve. The shares rose as much as 6.3 percent.

--With assistance from Shruti Singh in Chicago. Editors: Patrick McKiernan, Daniel Enoch

To contact the reporters on this story: Yi Tian in New York at; Maria Kolesnikova in London at

To contact the editor responsible for this story: Steve Stroth at

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