* Euro recovers from 2-month low vs dollar
* China Oct. copper production up by 8.6 pct y-o-y
* China aluminium output up on state buying plans
By Silvia Antonioli and Carrie Ho
LONDON/SHANGHAI, Nov 13 (Reuters) – Copper fell slightly on Tuesday as a
dispute between international lenders threatened to further delay an aid payment
to debt-burdened Greece, weighing on risk appetite and keeping the euro close to
a two-month low against the dollar.
Benchmark copper on the London Metal Exchange traded at $7,612 in
official rings, down 0.3 percent from a close of $7,638 on Monday.
“We keep getting positive data from the U.S. and China but the market is
worried about Greece,” said T-Commodity consultant Gianclaudio Torlizzi.
“Once again the EU is showing how immature it is at handling the debt
crisis: after the Madrid worries now Greece has come back to scare markets.”
The euro fell to a two-month low against the dollar before recovering
somewhat after a German newspaper said Germany wants to bundle Greek aid into a
single payment of more than 44 billion euros.
A higher dollar tends to make dollar-denominated commodities such as base
metals more expensive for holders of other currencies, weakening demand for
them.
Metals prices, however, are likely to see some support from recent data
showing the economy of China, the world’s biggest metals consumer, was
recovering and likely to meet its growth target for the year.
China consumed about 40 percent of global production of copper last year.
It produced some 520 thousand tonnes of refined copper in October, an 8.6
percent year-on-year increase, data from China’s National Bureau of Statistics
showed. China’s aluminium output also rose significantly, up by 20.3 percent
year-on-year to 1.72 million tonnes in October.
“On the back of higher treatment and refining charges, copper smelters
stepped up their capacity utilization rates in October to their highest level
this year…This also explains, at least in part, why copper imports were so
weak,” Commerzbank said in a research note.
“Chinese aluminium smelters have clearly felt encouraged by the plans of
the State Reserve Bureau to purchase 160 thousand tonnes of aluminium from the
country’s major producers, and have already increased production in
anticipation.”
PHYSICAL SALES
In copper physical markets, Chinese traders reported better domestic sales
as recent low prices drew in bargain-hunters.
“There has been a steady rise in domestic copper business lately. Imported
copper sales have also stayed stable due to a recent improved arbitrage,” said a
Shanghai-based trader.
LME copper was trading lower than the most active Shanghai Futures Exchange
copper price, giving consumers an opportunity to import.
For the longer-term outlook, state-backed research firm Antaike said in a
client note that China’s output of refined copper will continue to grow, albeit
at a lower pace than its production of ores and concentrates.
“Chinese reliance on imported copper concentrates will increase by 10
percent annually in the future… net import of refined copper will be stable at
around 2.1 million tonnes annually,” it said.
It also predicted that China’s demand for copper will also continue to grow,
but said the era of double digit growth was over.
Aluminium traded at $1,962 in rings from $1,968 Monday’s close while
zinc, used to galvanize steel, exchanged hands at $1,920 from $1,931.
Battery material lead was untraded in rings but was last bid at
$2,148 from $2,160 while tin traded at $20,400 from a last bid of
$20,350 a tonne on Monday.
Nickel, untraded in rings, was bid at $15,995 from $16,055.
Metal Prices at 1218 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2011 Ytd Pct
move
COMEX Cu 344.75 -2.05 -0.59 344.75 0.00
LME Alum 1955.25 -12.75 -0.65 2020.00 -3.21
LME Cu 7603.00 -35.00 -0.46 7600.00 0.04
LME Lead 2137.50 -22.50 -1.04 2034.00 5.09
LME Nickel 15991.00 -64.00 -0.40 18650.00 -14.26
LME Tin 20305.00 5.00 +0.02 19200.00 5.76
LME Zinc 1915.00 -16.00 -0.83 1845.00 3.79
SHFE Alu 15265.00 35.00 +0.23 15845.00 -3.66
SHFE Cu* 55420.00 -220.00 -0.40 55360.00 0.11
SHFE Zin 14925.00 105.00 +0.71 14795.00 0.88
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
