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Copper rebounds from sell-off, Peru supply threat supports

Copper prices rebounded on Wednesday after two days of losses supported by concerns about supply disruption from the Las Bampas mine in Peru and ongoing labour strikes in top producer Chile.

Three-month copper on the London Metal Exchange rose 0.2% to $9,264.50 a tonne by 0545 GMT. It shed a combined 3.4% in the previous two sessions to end at $9,247.50 a tonne on Tuesday, its lowest close since July 19.

The most-traded September copper contract on the Shanghai Futures Exchange closed down 1.5% at 68,720 yuan ($10,602.97) a tonne, tracking overnight losses in London.

“Last night was a $300 sell down. The U.S. markets got spooked. It’s normal (for copper) to bounce from there…(and) buy the dip,” said a Singapore-based metals trader, referring to sharp falls in the U.S. equities markets amid poor economic data.

Meanwhile, residents near MMG Ltd’s Las Bambas copper mine in the Peruvian Andes have blocked a road used to transport the metal after a two-week truce, community leaders said on Tuesday.

Earlier this month, the Andina mine in Chile was operating at a reduced level due to a strike, while workers at Chile’s Minera Lumina Copper mine also walked off the job.

FUNDAMENTALS

LME nickel fell 0.8% to $19,040 a tonne, lead fell 1.6% to $2,286 a tonne, while ShFE nickel declined 2.8% to 142,310 yuan a tonne and ShFE lead was down 0.5% at 15,335 yuan a tonne.

Yunnan Chihong Zinc & Germanium, a unit of state-run Chinese metals group Chinalco, said late on Tuesday one of its zinc subsidiaries had suspended production after three workers were killed in a gas leak.

Yangshan copper premium SMM-CUYP-CN leaped to $72 per tonne, its highest since March 3, indicating improving demand to import the metal into top consumer China.
Source: Reuters (Reporting by Mai Nguyen in Hanoi; editing by Krishna Chandra Eluri and Jason Neel)

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