Copper prices rally despite building tension in Chile

Copper prices

The red precious metal continues to be unstoppable.

Copper prices rose sharply on Tuesday and sped towards its highest settlement in one week despite building tension in Chile due to labor unrest.

Rejected Wage Hike

Prices of the red precious metal rallied 3% yesterday to reach its highest peak not seen in a week at $6000 per ton while the three-month London Metal exchange copper price shot up 1.26% and was last trading at $5 883 per metric ton.

Concerns loomed over the possible strike at the BHP Billiton-owned Escondida, the largest copper mine in Chile, as unionized workers in the firm rejected a wage offer from the management. However, workers still have until the end of the month to decide on a fresh wage proposal, which will serve as the wage standard for other mining companies in the country.

Copper prices have been in the bullish domain, up 14%, since the victory of real estate tycoon Donald Trump in the November 8 US Elections, which boosted the sentiments of Chilean workers to hold out for better salaries and benefits.

The red metal has tacked on 26% over the last three months on hopes that the new president will boost infrastructure spending that will increase the demand for the commodity, which has also benefited from a weaker dollar.

Meanwhile in the stock market, copper futures have also posted modest performance in Tuesday session as it finished 3.2% up to close at $41.59.

The world’s largest producer of the commodity, Chile, saw its output expanding by 3.4%, equivalent to 5.79 million tons, compare to a 4.3% increased output on a year prior.

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