By Claudia Carpenter Nov. 28 (Bloomberg) -- Aluminum headed for its worst losing streak in nine years in London on speculation increased shipments from China, the world’s largest producer, will exacerbate global oversupply. China may reduce or even cancel taxes on primary aluminum exports, Interfax reported today, citing an unidentified official from the China Nonferrous Metals Industry Association. Aluminum supply will outpace demand by 1.4 million metric tons next year, double this year’s surplus, according to BNP Paribas SA. “The immediate concern in the aluminum market is that you get some kind of production cuts and a change in export taxes would be counterproductive to that,” said Michael Widmer, a BNP Paribas analyst in London. “If more metal found its way outside China, we would have an even bigger oversupply in the global aluminum market.” Aluminum for delivery in three months declined $31, or 1.7 percent, to $1,760 a metric ton as of 4:43 p.m. on the London Metal Exchange, bringing the drop for November to 14 percent. The metal has declined for five consecutive months, the longest run since the period ending February 1999. The three-month contract for the metal used in beverage cans and cars will probably average $1,900 a ton next year, down from $2,630 this year, BNP forecast in a report today. Inventories of aluminum in warehouses monitored by the LME jumped 6,975 tons to 1.8 million tons, the most since Dec. 6, 1994. Copper dropped $96 to $3,600 a ton after inventories gained 2,925 tons to 291,650 tons, the most since Feb. 25, 2004. Copper averaged $2,726 in February 2004. Copper has tumbled 46 percent this year and aluminum is down 27 percent. Three-Month Lead The three-month lead contract dropped $3.50 to $1,101.50 a ton and earlier fell to $1,073, the lowest since July 27, 2006. Prices will average $800 a ton in 2010, $1,000 a ton next year and $2,330 a ton this year, BNP estimates. Inventories of the metal used in car batteries rose 400 tons to 41,600 tons. Zinc declined $35 to $1,185 a ton and nickel fell $150 to $10,100 a ton. Inventories of tin jumped 205 tons, or 4.7 percent, to 4,530 tons, the highest since Oct. 24. Tin for delivery in three months dropped $200 to $12,300 a ton. To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net or ccarpenter2@bloomberg.net

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