Panicked traders are ramping up bets on industrial and precious metals as an intensifying supply squeeze grips global markets, wrong-footing bearish investors who are being forced to cover short positions.

The so-called short squeeze rocketed copper prices on the London Metal Exchange above $US11,000 a tonne for the first time ever on Monday, joining futures traded in New York and Shanghai which hit record levels last week. Meanwhile, LME nickel spiked nearly 8 per cent on Friday.