LONDON, Nov 25 (Reuters) – Industrial metals prices rose on Thursday, with nickel pushing towards seven-year highs and tin reaching a record peak as low inventories pointed to tight supply while Chinese efforts to support its economy bolstered the demand outlook.
Benchmark nickel on the London Metal Exchange (LME) was up 0.9% at $21,035 a tonne by 1153 GMT. The metal used in stainless steel is up around 27% this year.
LME tin was flat at $39,955 after touching $40,680, its highest on record. Used in solder for electronics, tin has almost doubled in price since the start of the year.
“Inventory levels have come down tremendously. This speaks in favour of strong demand,” said Commerzbank analyst Daniel Briesemann.
“China also seems to be open to more fiscal policy support over the next few months. This should result in stronger demand for metals.”
However, prices are now so high that scope for further rapid gains is limited, he added.
RALLIES: Base metals have rallied since the COVID-19 pandemic began in early 2020, buoyed by economic stimulus from governments across the globe.
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Chinese iron ore and coal prices rose strongly.
NICKEL: On-warrant nickel inventories in LME-registered warehouses have fallen to 62,304 tonnes from more than 200,000 tonnes in April.
Tight supply has pushed cash nickel’s premium over the three-month LME contract to $194 a tonne, the highest since 2019.
TIN: LME on-warrant stocks of tin have risen to 1,000 tonnes from a historic low of 255 tonnes in October but remain far below typical levels.
A hefty $1,152 premium for cash tin over three-month metal points to a lack of available material.
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PRICES: LME copper was up 0.6% at $9,897.50 a tonne, aluminium rose 0.9% to $2,729, zinc gained 0.3% to $3,331 and lead was up 0.3% at $2,270.50.