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Copper prices may rise as quake halts mines in Chile

By Ren Jie (Agencies/chinadaily.com.cn)
Updated: 2010-03-01 11:24

Copper prices may rise as quake halts mines in Chile

Copper prices may rise after a magnitude-8.8 earthquake halted mines in Chile, cutting supplies from the world's largest producer, Bloomberg reported Monday.

At least four copper mines and two oil refineries were closed in Chile as electricity supplies were suspended by the earthquake, Bloomberg reported. The four mines account for 16 percent of the country's output. It was unclear when the four mines would resume operation.

Analysts and traders also expected copper prices might surge after the quake. The three-month copper contract that closed at $7,195 a metric ton on the London Metal Exchange last week may climb to $7,800 to $8,000, a gain of 8 percent to 11 percent, according to David Threlkeld, president of Arizona-based trader Resolved Inc. Edward Meir, an analyst at MF Global Ltd, forecast prices may rise $200 to $500 a ton.

Copper exporting to China would not be affected, as ports in the northern part of the country are not damaged in the quake and remain in operation, the Oriental Morning Post reported, citing Fernando Reyes Matta, Chilean ambassador to China.

However, China Minmetals Corp, the country's largest metals trader, said the influence of the earthquake on materials supply to China was still uncertain as the damage of the infrastructures, including water supply, highways, and harbors, may effect copper transportation.