LME copper rises; tin jumps almost 5% on technical breakout

London Metal Exchange tin blitzed the rest of the complex Wednesday as funds leaped at a technical play that market participants see driving it higher. LME tin jumped almost 5% Wednesday, to end just shy of $15,000/ton, short of its $15,100/ton April high. The metal has been traded around $14,000/ton since mid-May, traders said, which added fuel to the breakout, as buy stops were triggered at key technical levels all the way up. Already, analysts have warned of a "new nickel or lead" in the making, with technical indicators for the metal pointing as high as $16,000/ton, said UBS analyst Robin Bhar. Like the lead and nickel markets, the tin market is relatively small, with supply side stresses, and dominated by one or two "very, very large funds," analysts said. In the coming days, LME tin is set to challenge$15,100/ton hit in April when Indonesian supply problems kicked in, market players said. Indonesian authorities cracked down on dozens of small smelters last October, forcing them to close up shop due to environmental and tax code breaches, although some larger smelters have gradually come back on line. Mostly due to these problems, reported tin production from January to May was down 2,900 tons on the year, the World Bureau of Metal Statistics said Wednesday. The global tin market was in a deficit of 6,700 metric tons, it added, with global demand of 152,200 tons outweighing production of 145,500 tons. In other WBMS statistics released Wednesday, the global zinc market had a 66,000-ton surplus, while the rest of the metals were in deficit for the five-month time frame. The nickel market was in an 8,700-ton deficit as was aluminium, by 35,000 tons. The copper market was in a 144,000-ton deficit, while the lead market was in a 99,000-ton deficit, the group said. In other metals, LME lead touched a fresh record $3,260/ton, while copper remained supported by supply side concerns. Unions from Southern Copper Corp.'s (PCU) Cuajone and Toquepala mines and its Ilo smelter and refinery in Peru will hold meetings Thursday and Friday to decide whether to hold a new strike, a union leader said Wednesday. Southern Copper officials have forecast producing some 700,000 metric tons of copper this year at the units in Mexico and Peru. Also, the Salvador division at Chilean state copper company Corporacion Nacional del Cobre, or Codelco, remains closed amid contract workers' protests, while Andina is still snowed in and under its slower "winter regime," the company said Wednesday. Prices in dollar a metric ton. 3 Months Metal Bid-Ask Change from Tuesday PM kerb Copper 7820.0-7825.0 Up 55 Lead 3235.0-3236.0 Up 25 Zinc 3495.0-3505.0 Dn 15 Aluminium 2786.0-2787.0 Dn 12 Nickel 32695.0-32700.0 Up 705 Tin 14945.0-14950.0 Up 695