Copper fell the most in almost two weeks in London on signs that supplies are closer to meeting demand from China, the world’s largest buyer of the metal. Inventories of copper in Asian warehouses were unchanged, halting a slide since April 14, a daily London Metal Exchange report showed today. Stockpiling by China’s government has helped copper to jump as much as 73 percent on the Shanghai Futures Exchange this year, outpacing gains in London and spurring so-called arbitrage demand. “There are signs that the Shanghai-LME arbitrage is starting to close up a bit,” said Adam Rowley, an analyst at Macquarie Group Ltd. in London. “It doesn’t show demand is slowing, but it could be an indication enough metal has arrived and that tightness in Shanghai is easing a little.” Copper for delivery in three months dropped as much as 3.3 percent on the LME, the biggest intraday slide since April 28. The contract was down $121, or 2.6 percent, at $4,564 a metric ton at 11:43 a.m. local time. It was the third consecutive daily drop, the worst losing streak since February. It rose 4.8 percent in the prior two weeks. Recent gains were helped by purchases of copper contracts to cover short positions, or bets that prices would fall, Macquarie said today in a report. “The rise in copper prices was driven by a whole series of issues, the main one undoubtedly the strength of Chinese imports of refined copper,” Rowley said. “That prompted people who were short to cover those shorts.” Copper Imports Copper imports by China were a record 296,843 tons in March, according to customs figures released on April 22. April figures due tomorrow will probably show another “very large number,” Rowley said. Stockpiles of copper in Asian warehouses remained at 4,650 tons, the LME said today. The exchange’s overall inventories of the metal fell 3,825 tons to 385,175 tons. Aluminum stockpiles jumped 4,950 tons to 3.86 million tons, bringing supplies up 66 percent this year, more than any of the six main industrial metals on the LME. Dubai Aluminium Co., the largest smelter in the Middle East, said orders fell 30 percent in the first three months this year and will drop 20 percent in the second quarter as demand from carmakers and builders slumps. Aluminum smelters in China, the largest producing nation, may restart too much capacity in April and May, leading to a price decline, the China Nonferrous Metals Industry Association said. Aluminum for delivery in three months declined 0.5 percent to $1,536 a ton. Zinc Prices Prices of zinc will probably drop as plants resume production, according to Shenzhen Zhongjin Lingnan Nonfemet Co. Smelters are restarting as much as 500,000 tons of annual capacity, Li Xialin, chief engineer at the country’s third- biggest producer, said in an interview yesterday. Companies are also starting 700,000 tons of new annual capacity, he said. The three-month contract for zinc, used to rust-proof steel, fell 1.5 percent to $1,532.50 a ton. Among other LME metals for three-month delivery, nickel declined 1 percent to $12,975 a ton, tin dropped 2.1 percent to $13,700 a ton and lead slid 1.5 percent to $1,443 a ton. Changes in LME open interest and prices over the five days to May 7 suggest that investors were making new bets on higher prices for aluminum, zinc, nickel, lead and tin, according to the Macquarie report.

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