Copper Advances for First Time in Six Days on Demand for Japan Rebuilding

Copper climbed for the first time in six days on expectation that reconstruction needs afterJapan’s largest quake on record will boost demand in three to six months. All six metals on theLondon Metal Exchange rose.

The metal for three-month delivery rose as much as 1.4 percent to $9,244.75 a metric ton on the LME, and traded at $9,189 at 12:48 p.m. Shanghai time. The contract tumbled to a three-month low of $8,944.50 yesterday. June-deliver copper on the Shanghai Futures Exchange gained 1.3 percent to 69,470 yuan ($10,570) a ton at the mid-day break.

“Following the steep losses in the last few days, the price now looks attractive to some buyers,” Li Peiying, an analyst at Essence Futures Co., said by telephone from Beijing. “People have started to shift their attention to the rebuilding that will boost demand in the next few months.”

Copper and lead are likely to benefit due to power line and transformer replacements and the need for generators and batteries in light of power problems, Gayle Berry, an analyst withBarclays Capital, said in a report yesterday. Aluminum, zinc and nickel demand may also rise, according to the report.

Japanese stocks rose for the first time in five days on speculation a selloff yesterday that drove valuations to a 28- month low was excessive. The broader Topix index climbed as much as 6.7 percent, the most since October 2008, to 818.37.

Uncertain Shipments

Chinese imports of refined copper from Japan are expected to remain normal in March and April, although uncertainties remain for May and June, analysts led by Mark Pervan with Australia & New Zealand Banking Group Ltd., said in a report today. “March shipments have nearly been completed, while copper due to leave to China in April has been stored in warehouses in ports in western Japan.”

Mitsubishi Materials Corp., Japan’s third-largest copper maker, declared force majeure March 14 on concentrate shipments to its Onahama smelter, after the quake and tsunami halted power supply. The facility has an annual capacity of 258,000 tons, spokesman Toshiaki Yamada said today.

Japan last year supplied 253,157 tons of refined copper to China, the largest consumer, or 8.7 percent of Chinese imports, according to customs data.

Aluminum in London rose 0.7 percent to $2,510 a ton, zinc gained 1.1 percent to $2,308 a ton, and lead added 0.6 percent to $2,524 a ton. Nickel climbed 1.4 percent to $25,050 a ton, and tin advanced 0.5 percent to $28,750 a ton.

(Source: http://www.bloomberg.com/news/2011-03-16/copper-advances-for-first-time-in-six-days-on-demand-for-japan-rebuilding.html)