Copper hovered near its highest in two years on Friday, supported by supply disruptions, though souring US-China relations and rising coronavirus infections kept gains in check.
Three-month copper on the London Metal Exchange (LME) edged 0.1 per cent higher to $US6,455.50 a tonne, logging its ninth straight week of gains.
The industrial metal, also seen as a bellwether for economic health, rallied to its highest in nearly 25 months on Monday at $US6,633 a tonne on supply worries in top producer Chile.
But analysts say the price might be overheating and see fair value around $US6,000 a tonne.
“On the fundamental side, copper has gotten ahead of itself,” said Colin Hamilton, managing director of commodities research at BMO Capital Markets.
CORONAVIRUS: The United States shattered its daily record for coronavirus infections on Thursday, reporting more than 77,000 new cases as the number of deaths in a 24-hour period rose by nearly 1,000, according to a Reuters tally.
TRADE TENSIONS: US President Donald Trump’s administration was considering a ban on travel to the United States for all members of the Chinese Communist Party and their families.
POSITIONING: Large holdings of copper warrants and cash contracts have fuelled concerns about nearby supply on the LME market. SPREADS: The concerns can also be seen in the premium for cash copper over the three-month contract, which is at $US7 a tonne, compared with a discount of $US30 a month ago.
RIO TINTO: The global miner said that total mined copper production reached 132,800 tonnes in the three months to June 30, beating a consensus forecast of 114,000 tonnes.
OTHER METALS: Aluminium dipped by 0.5 per cent to $US1,662 a tonne, zinc fell 1.9 per cent to $US2,183, lead lost 2 per cent to $US1,821, tin was steady at $US17,375 and nickel was down 2 per cent at $US13,185.