Copper, Nickel Drop in London on Higher Stockpiles; Lead Rises

By Claudia Carpenter

Aug. 26 (Bloomberg) -- Copper and nickel declined in London as increases in stockpiles stoked speculation that supplies are adequate to meet demand. Lead, aluminum and tin advanced.

Copper inventories monitored by the London Metal Exchange have jumped 15 percent this month, data from the exchange show. The amount of nickel, used to make stainless steel, held in storage climbed 8 percent.

The copper inventory gain is ``typical for August because factories close down in Italy, France and other parts of Europe,'' leading to lower demand, said Kevin Tuohy, a trader at MF Global Ltd. in London. ``For nickel, I'm told stainless steel demand has been very slack.''

Copper for delivery in three months slid $5 to $7,655 a metric ton as of 8:52 a.m. in London on the London Metal Exchange. Nickel declined $300 to $20,550 a ton.

Inventories of copper have still dropped 17 percent this year while nickel stockpiles are down 2.3 percent. Of total nickel inventories of 46,830 tons, 97 percent are in Europe. For copper, 21 percent of the total is in Europe.

Lead rose $11 to $1,891 a ton and tin jumped $400 to $21,300. Aluminum gained $4.50 to $2,794.50 a ton. Zinc fell $36 to $1,794 a ton.

The UBS Bloomberg CMCI Index of 26 commodities has climbed 15 percent this year.

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net or ccarpenter2@bloomberg.net