Continued uncertainty at Chile's Collahuasi, the world's third largest copper mine, is likely to render positives to copper prices on Monday, or maybe well into this week, offsetting the negatives due to an expected China rate move.

While the management is hopeful of more employees accepting its sweetened paycheck offer and returning to work before Tuesday's deadline, union leaders say that management's attempt to lure employees will not succeed and a big majority will continue to stay away from work.

On Saturday, the striking workers did a massive demonstration in Chile's northern city of Iquique demanding higher wages and better working conditions. Radio Universidad de Chile described the demonstration as multitudinous and something the city had not seen in more than 35 years.

While the existing system doesn't allow paying workers who are on strike, Collahuasi had offered a bonus of nearly $29,000 up by around $1,000 from an earlier offer, for those come back for work before deadline. Union has not accepted the offer.

Copper for December delivery had ended last week at $3.833 per pound, little changed from Thursday's close. Commodities were largely down on Friday as investors shifted focus to China. If the world's largest commodity consumer hikes policy rates this week, as many fear, commodities are a sure bet to plunge.

However, the Chilean output worries could support the price of the most actively traded base metal, analysts say. Chile produces 33 percent of world's total copper output.

Three month-copper had fallen by $21 to $8,404 a tonne on London Metal Exchange. It had soared to a record $8,996 on November 11.

The People's Bank of China said on Friday it will raise the required reserve ratios for banks by 50 basis points from Nov 29 - the fifth such increase this year - in a move aimed at strengthening liquidity management and further tightening credit. However, analysts say the move is not sufficient to bring down the rate of credit growth in the country, and expect another policy rate hike. China had raised the key lending rate in October, the first such move since September 2007.

Codelco, a state-owned copper mine of Chile, is planning to offer annual physical copper premiums of up to $115 a tonne for Chinese buyers, media reports showed. The amount Codelco may arrive at may be considered as a benchmarlk by other miners as well.

Running into third week, the Collahuasi strike has become the biggest among privately owned mines in Chile, after the 26-day strike at Escondida in 2006. Collahuasi, jointly owned by Xstrata and Anglo American, aims to increase its output to more than a million tonnes a year and challenge nearby Escondida as the world's biggest copper mine.

There are media reports about a copper shipment loaded by Collahuasi last week but union workers say the mine is working only 20 percent of its capacity.

In a related development, Antofagasta, another copper producer in the Latin American country, signed a four-year wage agreement with workers at its largest copper mine, according to company's official sources.

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