-Aluminium hits 15-month peak, tin at two-year high

LONDON: Zinc rallied to its highest in five years on Monday, lifted by expectations that availability of the metal would remain tight after Glencore said it had shuttered one of its Australian mines.

Glencore's Black Star Open Cut mine in Queensland, part of the Mount Isa Mines complex, has been put on care and maintenance after mining out its existing reserve, the company said in a statement on Monday.

The benchmark zinc contract on the London Metal Exchange was untraded at the close, but was last bid at $2,457.50, up 2.5 percent. Earlier it touched its highest since August 2011 at $2,479.50.

Zinc, widely used in alloys, is one of this year's best performers among industrial metals, having benefited from supply shortages and a squeeze in the concentrate market.

"The combination of the sharp aluminium rally, Glencore shuttering the venerable Black Star zinc mine and continued strength in coking coal and iron ore saw stops triggered above $2,420 and sparked fresh momentum buying," Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York, said.

"While volume was quite strong the move was likely exacerbated by the start of LME Week, where much of the market is typically off the desks."

Goldman Sachs said in a note last week that it expected zinc to outperform aluminium and copper over the next six to nine months. Aluminium prices also rose to 15-month highs on Monday as the market factored in rising costs of production due to higher energy and raw material prices in top producer China.

LME aluminium closed up 1 percent at $1,735 a tonne, after earlier hitting its highest since July last year at $1,737.

"Aluminium has recovered impressively due to the increase in smelter costs from higher energy prices, which are tied to coal prices," said Julius Baer analyst Carsten Menke.

Copper ended the day up 0.2 percent at $4,852. Earlier it hit a three-week high at $4,878.

Analysts say copper prices have been supported by stimulus packages in top consumer China. Elsewhere, lead closed little changed at $2,065. Tin ended 0.2 percent higher at $20,700 a tonne, while nickel closed up 0.5 percent at $10,480 a tonne. Earlier, tin hit its highest since September 2014 at $20,745 a tonne boosted by worries about shortages and low LME stock.-Reuters