MARKETS-METALS (UPDATE 4) * Stronger yuan also raises metal output costs * Power accounts for about 45 percent of aluminium costs (Recasts, adds comment/details, pvs Singapore) By Pratima Desai LONDON, June 21 (Reuters) - Copper prices soared on Monday as China's pledge to make its yuan currency more flexible raised hopes of stronger demand growth from the world's largest consumer of industrial metals. Benchmark lead on the London Metal Exchange touched $1,820 a tonne, its highest since June 1, and tin saw $18,250, matching the peak of May 28. Three-month copper hit a session high of $6,729.75 a tonne. The industrial metal often used as a gauge of economic activity was trading at $6,640 a tonne at 0954 GMT from $6,435 a tonne at the close on Friday. China's move to make its yuan currency more flexible should be mildly bullish for many commodities, boosting China's purchasing power and possibly increasing its imports of copper and metals. "We know China has a voracious appetitie for raw materials ... Imports will be cheaper," said Robin Bhar, analyst at Credit Agricole. "It will raise production costs for some metals and that could mean cutbacks." However, Bhar and other analysts said the mood was tempered by news that China's central bank had ruled out a one-off revaluation of the currency. "The subsequent appreciation of the (yuan) against the dollar is likely to be small, perhaps just a few percent over the remainder of the year," Capital Economics said in a note. "This is not a game-changer and trade tensions will soon return. What's more, even a much bigger move would do nothing to boost the global economy without additional steps to increase demand within China itself." Also helping boost sentiment was the weaker dollar, which makes commodities priced in the U.S. currency cheaper for holders of other currencies. "We need to see confirmation ... by their activity in currency markets," Bhar said. "China is the highest cost producer for some metals such as nickel and zinc. The one that sticks out the most is aluminium." Aluminium was trading at $1,990 a tonne from $1,945 at the close on Friday. Earlier it touched a session high of $2,019. China is ther world's largest producer and consumer of aluminium, used in transport and packaging. Production costs have risen recently because of soaring electricity prices. Power is estimated by analysts to account for about 45 percent of aluminium smleting costs in China. Stainless ingredient nickel was trading at $20,125 a tonne from $19,595 at the close on Friday and zinc was at $1,799 from $1,725. Battery material lead was at $1,800 a tonne from $1,745 and tin at $18,000 from $17,450. (Reporting by Pratima Desai;editing by William Hardy)

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