(Bloomberg) -- Copper rose to the highest in almost four years as Chinese officials stepped up pollution-fighting efforts by halting processing plants.
On the Comex in New York, copper futures gained for a 14th day, the longest winning streak in more than a year, to post the highest closing price since January 2014. Jiangxi Copper Co., China's largest producer, received the order Monday to stop output for at least a week before a further assessment based on local pollution levels.
The supply threats are adding momentum to a 31 percent rally this year as the outlook for global economic growth improves. Goldman Sachs Group Inc. expects “strong demand and cost inflation to drive the price higher in 2018,” analysts including Jeffrey Currie wrote in a report dated Dec. 19. Demand for copper, often seen as a barometer for global growth, will rise about 30 percent by 2034, according to a report by Chile's copper commission Cochilco.
“There could be some strong price performance into next week and the new year until there's clarity on how much capacity is really getting affected,” said Tai Wong, the New York-based head of base and precious metals trading at BMO Capital Markets, in a telephone interview. “The market will have to decide if that's the beginning.”
Copper for delivery in March rose 1.3 percent to settle at $3.2805 a pound at 1:08 p.m. in New York. The 14-day rally is the longest since Nov. 10, 2016. Freeport-McMoRan Inc. led gains by producers, climbing as much as 3.8 percent.
The fervor for copper is also boosting exchange-traded funds. Assets in ETFS Copper, the largest ETF tracking the metal, soared to $256 million as of Dec. 22, the highest since Sept. 15, data compiled by Bloomberg show.
- NOTE: LME closed for public holiday; LME Index hit four-year high Dec. 22
- Metals news:
- Shanghai Exchange to Adjust Trading Margin For Some Futures
To contact the reporter on this story: Susanne Barton in New York at swalker33@bloomberg.net.
To contact the editors responsible for this story: James Attwood at jattwood3@bloomberg.net, Millie Munshi
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