(Adds analyst comment, updates prices, changes dateline)
By Eric Onstad
LONDON, July 14 (Reuters) - Copper prices extended gains on
Tuesday to touch their strongest in three weeks on signs of
firmer demand and shortages in China, as well as supply worries
after more attacks in the Middle East.
Benchmark three-month copper on the London Metal
Exchange climbed 0.4% to $13,601 a metric ton by 0930 GMT, its
highest since June 23.
"Copper is finding support from a combination of strong
Chinese export data and tightening physical market conditions,"
said Ewa Manthey, commodities strategist at ING.
Data showed that exports in top metals consumer China surged in
June in their best performance in four months.
The most-traded copper contract on the Shanghai Futures
Exchange rose 1.1% to 104,390 yuan per ton.
"Rising Chinese premiums and falling exchange inventories
suggest spot availability is becoming more constrained," Manthey
added.
The premium paid over SHFE prices to buy copper in the spot
market rose to 215 yuan per ton, up from zero at
the end of June and its highest since late February.
A weaker dollar index also supported metals markets,
making commodities priced in the U.S. currency cheaper for
buyers using other currencies.
Escalation in the Iran conflict also revived concern about
supplies of sulphur from the Gulf, a key risk for copper and
nickel supply chains. Sulphuric acid is used in copper leaching.
The U.S. hit Iran with five hours of strikes while a U.S. air
base in Jordan was targeted by Iranian missiles, sending oil
prices to their highest in four weeks.
LME aluminium added 0.2% to $3,177 a ton, nickel
was little changed at $16,765, zinc advanced 0.5% to
$3,582 and tin climbed 1.8% to $53,525.
Lead fell 0.5% to $1,859.50 a ton after LME
inventories jumped by 80,700 tons or 28% after arrivals in
Singapore warehouses.