METALS-Copper scales record peak on supply tightness, softer dollar

Nov 28 (Reuters) - Copper powered to a record high above $11,200 a metric ton on Friday, as supply of the metal outside the United States tightened and a weaker dollar fuelled the rally further.

Benchmark three-month copper CMCU3 on the London Metal Exchange rose as much as 2.5% to $11,210.50, surpassing the previous all-time peak of $11,200 hit on October 29. The metal was up 2.3% at $11,188.50 as of 1700 GMT, on course for a weekly gain of 3.8% and a rise of 2.8% in November.

Natalie Scott-Gray, senior metals analyst at broker StoneX SNEX.O, attributed the record to bullish headlines from the Cesco gathering in Shanghai and the pull of refined copper into the United States, leaving other regions short - all amid a supportive macroeconomic outlook and positive fundamentals.

"Having said this, we are cautious once this trade is priced in. A clear break higher in prices will be hard to be maintained over the course of 2026," Scott-Gray added.

The cash LME copper contract was commanding a $53 a ton premium over the three-month forward CMCU0-3, the highest level since mid-October, underscoring a growing need for near-term metal.

Top producer Chile's statistics agency said the country's copper output fell 7% year-on-year in October, while in China, key smelters have agreed to cut production by more than 10% next year because of negative processing fees.

Further support for prices was coming from the dollar .DXY, which was on course for its worst week since late July on bets the U.S. Federal Reserve will make another rate cut. A softer dollar makes dollar-denominated metals more affordable for holders of other currencies.

Tin CMSN3 was up 3.3% at $39,235 a ton. It earlier hit its highest since May 2022 as talk of supply disruption in the Democratic Republic of Congo fanned fears of shortages, even as traders said speculation over a force majeure at the Bisie mine was untrue.

Aluminium CMAL3 rose 1.4% to $2,868.50, zinc CMZN3 added 1.2% to $3,052.50, nickel CMNI3 inched up 0.1% to $14,840, while lead CMPB3 slipped 0.3% to $1,979.