Chile’s Codelco resumes shipments but faces nationwide strike on Tuesday

Copper climbed 1.2% to $3.383 a pound in New York on Monday morning, the highest price in almost a month, as several investors bought the red metal to close out bets on lower prices before mining workers in Chile, the world’s No. 1 producer, announce they will begin their strike tomorrow.

Unions representing more than 25,000 workers at state-owned Codelco, and other firms including BHP Billiton (ASX, NYSE:BHP) and Anglo American (LON:AAL), said they will strike for a day, beginning at 5 a.m. local time Tuesday (10 a.m. GMT), at every Codelco division and at all the large-scale private mines for 24 hours.

According to Prensa Latina (in Spanish), the Chilean miner resumed shipments of copper on Saturday following the end of a port strike that slammed Codelco’s exports, which hindered an estimated 9,000 tonnes of the commodity’s shipments per day.

The strike comes against a backdrop of a presidential election year and it may heavily weigh on the results.

The South American country generates about a third of the world's copper and its stable economy is largely built around minerals exports of minerals. The red metal alone accounts for nearly a third of government revenue.

Mining also provides most of the nation's poor their best shot at a middle-class life, especially in the rural and rugged desert areas of northern Chile, where the majority of mines are located.

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Copper prices also rose Monday due to speculation about more Federal Reserve asset buying, or quantitative easing, after figures released April 5 that the US added way less jobs in March than anticipated by analysts.

The commodity fell to an eight-month low of $7,331 a tonne on the London Metal Exchange last week, 28% lower than a record high in 2011. However, almost all copper mines remain profitable at current prices, leading some to speculate that prices could fall further.

Image: Lukasz Z/