Mining Profits...Investing In Industrial Metals

Copper headed for a ninth straight quarterly gain in London on speculation that workers at the Highland Valley mine in Canada may strike, reducing supply of the metal used in pipes and wires.

Workers voted to strike Oct. 1 if they fail to reach an agreement with the mine's owner Teck Cominco Ltd., United Steelworkers official Richard Boyce said yesterday. Copper has soared to a record this year as disruption at mines in Asia and South America reduced output.

``There's a large potential for problems out there and people are not comfortable,'' said Kevin Tuohy, a trader at Man Financial Ltd., one of 11 companies dealing on the floor of the London Metal Exchange.

Copper for delivery in three months on the LME rose $65, or 0.9 percent, to $7,535 a metric ton as of 10:52 a.m. local time. It has gained 2.9 percent this quarter. The metal traded at $8,800 on May 11.

Highland Valley, located in British Columbia, produced 179,000 metric tons of copper in 2005, about 1.2 percent of the 14.9 million tons the Lisbon-based International Copper Study Group estimates companies mined around the world last year.

A production shortfall has forced consumers to tap stockpiles. Copper inventory monitored by the LME fell 3,800 tons, or 3.1 percent, to 117,575 tons, the exchange said today in a daily report. That's the biggest drop since June 13. LME stockpiles are equal to less than three days of global consumption.

Copper needs to close above $7,600 a ton to spur buying from investors tracking technical charts, Tuohy said. Five of 11 analysts, investors, traders and consumers surveyed yesterday and Sept. 26 by Bloomberg News said copper will fall next week. Four said it will rise and two forecast little change.

Aluminum lost $25 to $2,580 a ton and nickel dropped $225 to $28,775. Lead gained $7 to $1,395 and tin slid $50 at $9,000. Zinc dropped $15 to $3,340 a ton.