LONDON, Nov. 20 -- Copper prices fell the most in two weeks as the dollar climbed, reducing the metal's appeal as an alternative investment.
The U.S. Dollar Index, which gauges the greenback's value against six major currencies, gained as much as 0.5 percent. Some traders buy raw materials when the U.S. currency weakens, to preserve purchasing power. Copper prices more than doubled this year as the dollar index lost 7.4 percent.
"All these commodities are reacting to the dollar more than anything right now," said Lannie Cohen, the president of Capitol Commodity Services Inc. in Indianapolis. "It's the main driver for prices."
Copper futures for March delivery slid 2.95 cents, or 0.9 percent, to $3.106 a pound on the New York Mercantile Exchange's Comex division. That's the steepest drop since Nov. 5.
The metal's declines were limited as wage talks between miners and employers across South America spurred supply concerns, said Steve Hardcastle, a Sucden Financial Ltd. analyst in London.
BHP Billiton Ltd., the world's biggest mining company, will "evacuate" its Spence copper mine in northern Chile after worker "sabotage," Diego Hernandez, BHP's base-metals president, said yesterday. Workers said an agreement to hold talks with management to end a 38-day walkout broke down.
The strike has halted output of 500 metric tons a day at Spence, according to the company. The mine produced around 200,000 tons of the metal last year, according to Standard Bank Group Ltd. Hernandez also said BHP made a wage offer to workers at its Cerro Colorado copper mine, also in Chile.
On the London Metal Exchange, copper for three-month delivery slid $85, or 1.2 percent, to $6,795 a ton ($3.08 a pound). Among other LME metals for three-month delivery, zinc, aluminum, tin, nickel and lead prices fell.