METALS-Copper nears $11,000 as tight supply, trade talks in focus

By Tom Daly

Oct 24 (Reuters) - Copper rallied toward $11,000 per metric ton on Friday on persistent concerns over a shortage of supply and renewed optimism over trade talks between the United States and China.

Benchmark three-month copper CMCU3 on the London Metal Exchange was up 1% at $10,960 as of 1600 GMT. It earlier touched $10,979.50, the highest since October 9, when copper struck a 16-month peak of $11,000.

The metal was on course for its highest ever close and a weekly rise of 3.3%.

"I think copper will carry on ... purely because there is a developing shortage as a result of the mud rush at Grasberg and the ongoing need for copper, particularly in China but around the world," said SP Angel analyst John Meyer.

Freeport's Grasberg mine in Indonesia has been shut since the incident on September 8, while Chilean miner Antofagasta ANTO.L on Thursday said it expects its 2025 copper output to come in at the lower end of its 660,000-700,000 tons forecast.

LME copper stocks MCUSTX-TOTAL of 136,350 tons are at their lowest since late July, while Shanghai Futures Exchange copper inventories CU-STX-SGH fell to 104,792 tons.

Meyer said there was potential for a squeeze in copper like the one seen in zinc this week, where Chinese smelters playing the London-Shanghai arbitrage risk getting caught out because of a lack of physical metal.

White House press secretary Karoline Leavitt has meanwhile confirmed U.S. President Donald Trump will meet Chinese counterpart Xi Jinping next Thursday in South Korea.

"Any constructive signals emerging from the upcoming Trump–Xi summit could also aid sentiment," Neil Welsh, head of metals at Britannia Global Markets, said in a note, adding that the U.S. Federal Reserve was expected to lower rates next week, which could weaken the dollar and support commodity prices.

Aluminium CMAL3 dipped 0.2% to $2,856 a ton, after touching $2,883.50, its highest since May 2022 on supply fears. Zinc CMZN3 added 0.2% to $3,020.50 and lead CMPB3 gained 0.3% to $2,015, while tin CMSN3 and nickel CMNI3 both inched up 0.1%, to $35,670 and $15,360, respectively.