Copper slips but Indonesia mine blockade lends support

Copper eased on Friday after posting the strongest gain in six weeks the session before, with losses capped by supply concerns as a blockade of the Grasberg mine in Indonesia entered its fifth day.

“Copper may have got a little ahead of itself overnight and what we’re seeing is a bit of a pullback,’’ a trader said. “But supply out of Indonesia is still a factor.’’

Workers began blocking a road into the Freeport-McMoRan Inc mine on Monday to protest against a settlement reached with other employees at the end of a previous dispute.

Three-month copper on the London Metal Exchange stood at $5,833 a tonne at 0410 GMT versus $5,850 in the last London close. The contract rose 3.2 per cent on Thursday, the biggest daily gain since early February.

The most-traded May copper contract on the Shanghai Futures Exchange climbed 2 percent to 42,260 yuan ($6,829) a tonne.

Traders said indications that the US Federal Reserve was less likely to act aggressively in raising interest rates than anticipated was also boosting the sentiment for base metals.

Aluminium, nickel

Aluminium was fetching $1,784 a tonne, up $4, despite signs of oversupply dragging on the market.

Japan’s aluminium premiums for April-June contract shipments were mostly set at $380 per tonne, down for the first time in six quarters on higher inventories and slumping spot premiums.

LME nickel slipped $30 to $13,740 a tonne, though traders said the metal was still finding support from trade data showing a global nickel surplus fell by 70 per cent between December and January.

A weaker US dollar was also seen spurring interest in commodities, traders said. A soft greenback makes dollar-denominated assets such as metals cheaper for buyers holding other currencies.