Base metals may remain on the upside path on supply concerns. Copper
may test 425 levels while taking support near 380 levels.The global the copper market is headed for a surplus of between 200,000-300,000 tonnes in 2020. Supply prospects for copper got a boost after Peru, the world's second-biggest producer of copper.
Glencore's Zambian subsidiary Mopani Copper Mines will resume mining for 90 days following a backlash from the government, but the company still expects to go ahead with its initial plan to place operations on hold.
Copper supply, meanwhile, has been massively disrupted by national lockdowns of mines, particularly in Peru, a major supplier of raw materials to China's smelters. Freeport-McMoRan Inc is planning to reassess operations at a New Mexico copper mine that has been temporarily shuttered due to the COVID-19.
China's unwrought copper imports rose 4.4% in April from the prior month. In signs of rising demand, on-warrant LME inventories of copper fell to their lowest in a month, slipping 250 tonnes to 190,200 tonnes. Zinc may recover towards 162 by taking support near 145. Zinc prices hit their highest in nearly five weeks as promises of more stimulus from Beijing boosted steel prices.
Lead may face resistance near 140 levels while taking support near 128. Nickel may witness recovery towards 960 while taking support near 900 levels.
Aluminum also may remain in a narrow range of 129-138 levels. The metal used in packaging and transportation has tumbled around 20% since mid-January as the coronavirus pandemic shuttered the global industry. But global output has risen, and it is expected a surplus of 1.5 million tonnes this year in the roughly 60-million tonne a year market.
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