Copper held near a two-week low on concern that exports from Freeport-McMoRan’s Indonesia mine set to resume shipments from its Grasberg mine in Indonesia, the world’s second-largest for the commodity, will add to an oversupply. Most other industrial metals climbed.

Indonesia approved the renewal of an export license that will allow Freeport to ship about 1 million metric tons through August 8, according to a trade ministry official. Copper was down a fourth day on the London Metal Exchange, set for the longest run in almost a month.

The metal has dropped 20% in the past year as China’s economic slowdown cut demand, prompting some mining companies to shutter unprofitable production. New supply due this year will largely offset the impact of supply cuts, Morgan Stanley said in a report Tuesday. It expects mine output to expand 3% this year to 19.9 million tons.

“News that Freeport-McMoRan is set to resume shipping from its Grasberg mine in Indonesia acted as a dampener on copper prices,” Sucden Financial said in an e-mailed report. “The ramping up of operations at world’s second-largest mine by capacity will likely add to the supply glut.”

Copper for delivery in three months lost 0.4% to $4,491.50 a ton by 10:29am on the LME, after earlier sliding as much as 1.2% to touch the lowest since January 26. Prices dropped 2.2% on Tuesday, the most since mid-December. Markets in mainland China, the biggest user, remain closed for the New Year holidays.

Other main metals traded in London gained as European equities rose for the first time in eight days. Lead and zinc climbed at least 1.4%, while nickel fell.

The FTSE 350 Mining Index was little changed after slumping 5.7% Tuesday, the most since December.

Source:-Mineweb