The massive earthquake that rocked Chile and sent a wave of tsunami warnings the world over led to a spike in already high copper prices, a Bank of Montreal commodity strategist said Monday.
BMO’s Bart Melek said Saturday's 8.8 magnitude quake temporarily shut down several mines in the South American country. About one-fifth of Chile's copper capacity or 1 million tonnes was affected, sending copper prices up significantly overnight.
The S&P/TSX’s metals sector was up nearly 10% by mid-morning trading Monday, with copper adding another 1.22% to previous gains at $3.32. Copper was among the four best performing commodities last year, ahead of gold, according to Scotiabank’s Commodity Price Index.
In London, copper hit its highest price in more than five weeks, fuelling speculation that the metal could top its record-breaking performance in 2009.
Spotty production at four Anglo American mines in northern Chile among others could slash the global copper surplus by half, or 50,000 tonnes, Melek told reporters on a conference call during the 19th annual Global Metals and Mining Conference.
