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Comex copper rises on trade buying, eyes port strike

NEW YORK: Comex copper futures ended firmer Wednesday after trade houses crept in to buy in light volume, even as trading floor talk of a port strike in Chile raised concern among some traders, sources said.

"There was news of a port strike in Chile and that might put the scare into these guys," said one Comex trader.

However, analysts maintained there were sufficient supplies after recent record-highs in exchange warehouses to meet demand for copper in the near-term.

Active May copper finished up 0.30 cent at 80.70 cents a lb after ranging 80 to 80.85 cents. Spot March gained 0.25 to 79.65 cents and the rest rose 0.25 to 0.30 cent.

Analysts said the market has been under pressure from London since falling from key resistance levels, and the malaise was simply "a general lack of interest," said Refco analyst Dan Horn.

"When copper fell below $1,800, it set a bearish tone, but if we can break 81.20 again, that should invite some buying," Horn said.

London arbitrage also helped to wedge copper in its now well-worn range, according to floor sources who noted buying in back months July and September.

Funds were not expected to enter the fray until prices fill the recent gap, leaving other dealers to trade in a technical band between 100- and 200-day moving averages.

The London Metal Exchange (LME) three-months price ranged between support at $1,740 a tonne and resistance at $1,780, with an upper level at around $1,800.

In London, three-months copper closed at $1,773 a tonne, up$5 from Tuesday's close.

LME warehouse stocks fell 4,800 metric tonnes to 766,200 tonnes, while Comex stocks were down 46 short tons to 95,681 tons in Tuesday's report.

In other news, Russia plans to raise export tariffs on non-ferrous scrap metals by 50 percent in order to prevent excessive exports and curb an illegal trade that has claimed hundreds of lives.

"More than 700 people, including young people and children have been killed while stealing high voltage power lines," said Yegor Stroyev, the Federation Council speaker.

Currently seven scrap metals -- copper, nickel, aluminum, lead, zinc, cobalt and titanium -- are liable to a 30 percent export tariff there.

Final estimated volumes for Comex copper reached 10,000 contracts, compared with the previous official count of just 7,263 lots.

Traders pegged near-term support in May Comex copper at 80 cents with resistance at 80.80 to 81.30 cents.

The nine-day relative strength index (RSI) for May rose to 46 on Wednesday, up from 38 at the close on Tuesday.

Analysts said an RSI reading of 70 or higher usually indicates that a market is overbought, while 30 or lower means it is oversold.

Comex is a division of the New York Mercantile Exchange. -Reuters