FU: Copper climbs off week lows on bargain hunting
* Bargain hunters snap up copper as LME volumes soar
* Strike at No. 3 copper mine Collahuasi enters 19th day
* COMING UP: U.S. Preliminary 3Q GDP at 1330 GMT
(Adds comment/details, pvs SINGAPORE)
By Melanie Burton
LONDON, Nov 23 (Reuters) - Copper fell near a one-week low on Tuesday as the dollar rallied amid escalating tensions on the Korean Peninsula and worries over debt-laden Europe, but bargain hunters cushioned losses on expectations of demand from China.
Benchmark copper on the London Metal Exchange fell to $8,122.50 at 1105 GMT from a close of $8,290 a tonne on Monday.
The metal earlier fell to its cheapest in one week at $8,050 a tonne and has now slipped nearly 10 percent from its recent record high of $8,966 a tonne on Nov. 11.
"Whenever there is a correction, it presents a buying opportunity," said Societe Generale analyst David Wilson.
"No one in China is worried about rate hikes slowing down demand for metal ... Speaking to copper producers, they all have full order books. Even the tier four cities are on a huge building spree and it's not slowing down."
Concerns that a rate hike in China would curb demand for metals has weighed on the complex in recent weeks. Data this week showed that copper imports fell by almost a third in October, but analyst said the monthly fall was driven by supply rather than by demand.
China is the world's top consumer of base metals.
The dollar rallied on Tuesday after North Korea shelled a South Korean island, adding geopolitical tension to Europe's debt crisis and driving investors into safe-havens.
A stronger dollar makes metals more expensive for holders of other currencies.
In economic news that could impact metals via currency markets, the U.S. Commerce Department releases its preliminary estimate of third-quarter gross domestic product at 1330 GMT, followed by existing home sales for October and the Richmond area manufacturing index at 1500 GMT.
BARGAIN HUNTING
Volumes of copper on LME electronic platform Select have soared with over 11,000 lots having changed hands - already two thirds of average daily volume for the three-month contract - a sign that bargain hunters are active at these levels.
A trader noted fund buying as well as consumer buying for December dates but said that prices appeared vulnerable to declines at these levels. "Copper already fell through the $8,000 level last week; it's not an impossible floor for it to revisit."
Fresh signs have emerged of a tightening copper market next month with metal for delivery on Dec. 15 trading at "pretty brutal" premiums over those for one week later, the trader said.
Supply has been tightening noticeably since cash copper flipped into a premium against the benchmark three month contract some two weeks ago.
In other news, the union at Codelco's Radomiro Tomic mine said earlier it saw the state miner's latest wage offer as a good proposal, indicating a deal was likely to avert strike action at the 300,000 tonne-per-year deposit.
The world's No. 3 copper mine, Collahuasi, said on Tuesday copper output and deliveries remained normal under a contingency plan, even while a workers' strike entered a 19th day.
Across other metals, aluminium traded at $2,264 a tonne from $2,288 a tonne, while stainless steel material nickel slipped to $21,300 from $21,600 on Monday's close.
Zinc, used in galvanising, edged down to $2,096 a tonne from $2,138, an almost 2 percent loss, while lead, used in the battery sector, reached $2,193 from $2,250.
Tin retraced to as low as $24,000, approaching near two-month lows below $23,600 a tonne. It was last at $24,050 from $24,300 late on Monday. Inventories rose to their highest levels since early September, LME data showed, as industry winds down towards year end. Metal Prices at 1107 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Percent Move End 2009 Ytd Percent
move COMEX Cu 369.05 -6.10 -1.63 334.65 10.28 LME Alum 2285.00 -3.00 -0.13 2230.00 2.47 LME Cu 8275.00 -15.00 -0.18 7375.00 12.20 LME Lead 2240.00 -10.00 -0.44 2432.00 -7.89 LME Nickel 21500.00 -100.00 -0.46 18525.00 16.06 LME Tin 24300.00 0.00 +0.00 16950.00 43.36 LME Zinc 2135.00 -3.00 -0.14 2560.00 -16.60 SHFE Alu 16180.00 -220.00 -1.34 17160.00 -5.71 SHFE Cu* 61430.00 -1880.00 -2.97 59900.00 2.55 SHFE Zin 17015.00 -785.00 -4.41 21195.00 -19.72 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07
