Copper Falls as Supply Concerns Ease

By David Hodari 

LONDON--Copper prices slipped on Friday as concerns about supply that had supported recent bullish forecasts for the metal continued to subside.

The price of copper was down 1.6% at $6,856 a metric ton in late morning trade.

Elsewhere, aluminum prices fell 1.6% to $6,855 a metric ton, continuing their recent volatility after prices spiked later Thursday on reports that Oleg Deripaska, who controls beleaguered aluminum giant United Co. Rusal, plans to maintain his links with the company despite the U.S. government's offer of sanction relief in the event that he were to stand down.

Gold, meanwhile, edged 0.04% higher to $1,317.84 a troy ounce.

Copper on Friday was weighed down after mining company Freeport-McMoRan Inc. indicated that the latest in its long line of disputes with the Indonesian government had not affected production at Grasberg, the world's second largest copper mine.

The Indonesian government recently proposed new rules demanding Grasberg store 90% of its tailings waste on site as opposed to the current 50%. That would contradict the two parties' current license conditions, and Freeport said the change couldn't be made.

Despite this, Freeport said it had not received notice to halt production, according to John Meyer, an analyst at SP Angel.

Elsewhere, Norilsk Nickel reported Thursday that its first-quarter copper production had risen 18.5% year on year. That factor added to copper's headwinds, according to Alastair Munro, a broker at Marex Spectron.

It wasn't all bearish news, however, with trade union leaders saying that labor negotiations at the BHP Billiton-operated Escondida mine in Chile were moving more slowly than expected.

If the two parties fail to reach an agreement, they'll have to try again in July when the contract expires, said ING strategists.

Metals traders were continuing to monitor developments in the aluminum market, U.S. GDP data and news from the meeting of the leaders of North and South Korea.

Among precious metals, silver was up 0.06% at $16.53 a troy ounce, platinum was up 0.18% at $909.10 a troy ounce and palladium was down 0.15% at $968.05 a troy ounce.

Among base metals, zinc was up 0.37% at $3,146.50 a metric ton, nickel was down 1.57% at $14,065 a metric ton, tin was down 0.23% at $21,255 a metric ton, and lead was down 0.19% at $2,334 a metric ton.

Write to David Hodari at [e-mail]

(END) Dow Jones Newswires

April 27, 2018 06:44 ET (10:44 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.