Copper advanced to the highest level in 11 weeks on concerns over the looming shutdown of a large mine in Panama and amid expectations of a widening ore supply deficit in 2024.
The Panama government has said it will shut First Quantum Minerals Ltd.’s Cobre operation, which produces about 1.5% of the world’s supply. The mine already suspended output last month as a blockade of boats restricted key supplies amid mass protests from environmentalists and labor unions.
The disruption comes as the gap between demand and supply for copper ore is set to widen next year, according to BloombergNEF. Two key producing regions — Chile and Peru — are facing bottlenecks in increasing output, while demand is rising in China, it said. Copper prices are likely to remain elevated, it added.
Copper climbed 4.4% in November, the first monthly increase since July, as a slew of stimulus in China improved the outlook for commodity demand in the top consuming nation. A weakening dollar also helped commodities priced in the greenback as they became cheaper for buyers in other currencies.
Copper rose as much as 0.5% to $8,507 a ton on the London Metal Exchange, before trading at $8,490 by 11:09 a.m. in Shanghai. Most metals were higher, with aluminum and zinc up 0.2%.
