LONDON, Dec 31 (Reuters) - Industrial metals ended 2021
posting their biggest annual price gains since 2009 driven by
tight supply and increased demand and led by aluminium and tin.
Prices were mixed on Friday, with trading muted during the
Christmas holiday season.
The London Metal Exchange (LME) index, made up of
copper, aluminium, nickel, zinc, lead and tin, was up 32% in
2021 after rising 20% in 2020.
"It's been a year with strong demand recovery from the
pandemic," said ING analyst Wenyu Yao. "Most metals markets
flipped into deficit."
"Looking into 2022, we expect it's a year of normalisation.
We expect demand growth to moderate," she said, adding that
limited supply should keep prices high, at least in the near
PRICES: Benchmark copper on the LME closed up 0.3%
at $9,720.50 a tonne and up 25% in 2021, having risen 26% in
LME aluminium fell 0.4% to $2,807.50 a tonne on
Friday but was up 42% in 2021, its biggest gain since 2009.
Zinc was flat at $3,534 but for the year was up
28.5% higher in its biggest jump since 2017.
Nickel was 0.8% higher at $20,757 on Friday and up
25% this year, its largest annual rise since 2019.
Lead rose 0.3% to $2,304 and was up 15% in 2021, its
biggest gain since 2017.
Tin was down 0.9% at $38,860 a tonne. For 2021, it
was up more than 90%, the largest annual gain in at least two
RALLIES: Other commodities also surged in 2021 and global
stock markets were on track for a third consecutive year of
CHINA: China's factory activity unexpectedly accelerated in
December, but analysts see trouble ahead.
"China has been a primary source of demand for base metals
since 2003, but we think this trend has started to come to an
end," said Justin Smirk, an economist at Westpac.
"With the decline of investment and production as key growth
drivers, this will see diminishing incremental economic growth
and a reduction in materials demand as a share of output," he
PERU: The operators of the Las Bambas copper mine in Peru
said it would restart operations after reaching a deal with
protesters blocking a road to the mine.
CHILE: Copper output in Chile, the world's largest producer,
fell 1.6% year-on-year in November.
(Reporting by Peter Hobson; Additional reporting by Enrico Dela
Cruz in Manila; editing by Jan Harvey and Jason Neely)