Panama President sees no immediate risk from First Quantum mine
Jose Raul Mulino said a government report shows there are no immediate environmental or safety risks from Cobre Panama.
Copper hit a three-month high as it headed for its biggest monthly advance since January, supported by growing optimism over Chinese demand and mounting supply risks in Chile.
On the demand side, Beijing’s leadership has promised more support for the real estate sector and a reduction in the local-government debt burden, which are expected to boost the need for commodities in the top metals consumer. While authorities have stopped short of any “big-bang” stimulus, officials on Monday said they are studying more support policies to drive consumption of electric vehicles, which are a major emerging driver of copper demand.
Signs of slowing inflation in the US have also boosted sentiment across financial markets this month, as investors bet that the Federal Reserve could soon bring its aggressive campaign of rate hikes to a close. Chicago Fed President Austan Goolsbee said on Monday that data showing slower US inflation is “fabulous news,” but he hasn’t yet decided on whether to support pausing rate increases.
Supply risks were also in focus after Chilean copper mining giant Codelco on Friday lowered its annual production guidance and raised cost estimates after another disappointing quarter. Official data from Chile’s statistics agency on Monday showed national copper production rebounded month on month in June, but was down 0.9% from a year earlier.
The decline at Codelco was driven by a “notably weak performance” at its Chuquicamata, Ministro Hales and El Teniente mines, BMO Capital Markets analyst Colin Hamilton said in an emailed note. “While this shows a broader industry trend where mining companies continue facing operational challenges, Codelco’s situation is unique.”
[Click here for an interactive chart of copper prices]
Copper rose as much as 1.8% to $8,821 a ton on the London Metal Exchange, the highest level since April 21, and was trading at $8,815.00 as of 4:22 p.m. local time. It’s up about 6% this month.
In other metals, zinc rallied 2.8% after an increase in orders to withdraw metal from warehouses tracked by the LME. Other contracts were mixed, with aluminum rising 2.1% while nickel fell 0.4%.
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