China's copper and aluminium production are set for another record month in April, after a March surge, resulting from expanded capacity and rosy demand forecasts by producers. China produced a record 470,000 tonnes of refined copper in March, up nearly 6 percent from a peak set in December 2010, data from the National Bureau of Statistics showed on Friday. Some of the output increase was linked to a natural rebound after a short month and smelter slowdown during the Lunar New Year holiday in February as well as demand for copper and aluminium intensive products such as air conditioners ahead of the summer, analysts said. They added that higher than expected inflation in March won't lead smelters to keep production in check in the near term. "(We) did not see any factors that limited smelter production (in March). In fact, many smelters such as Jiangxi Copper have been increasing production," Guo said, who expects April's output to rise from March. China's economy grew an annual 9.7 percent in the first quarter versus a 9.8 percent clip in the previous quarter, while consumer inflation hit a 32-month high of 5.4 percent in March, government data showed on Friday. The data raised broad investor concerns that Beijing may move again to tighten credit further, hitting copper and aluminium demand in the world's top consumer of the both metals. OUTLOOK SOLID Expanded smelter capacity and sufficient raw material supply has pushed up China's copper production, said Guo Yong, analyst at Jinrui Futures, a subsidiary of China's top copper producer Jiangxi Copper Corp. Jiangxi Copper Co Ltd plans to produce 940,000 tonnes of refined copper this year, from 900,000 tonnes last year based on the demand and supply situation, he said. He added that smelters had been building stocks since extra supplies had driven down international prices after the Japan quake. Some small copper production plants using scrap as feed were built in the southern provinces of Guangdong and Guangxi, adding production this year, Guo said. ALUMINIUM China's primary aluminium production also rose to record high at 1.428 million tonnes in March, up nearly 1 percent from the previous May 2010 record, even as Beijing has pushed for aggressive consolidation in the industry. However, many aluminium smelters have increased production and started new capacity after local power supply rose in late February, smelter officials said. Reduced power between the fourth quarter of last year and early February this year in some provinces, such as southwestern Guizhou, had limited smelter production. LEAD, ZINC, NICKEL Refined lead production rose 33.9 percent from the same month of last year to 407,000 tonnes in March on a continued rebound in operations after the Lunar New Year holidays. Output may rise in April with the re-start of a 100,000 tonne-a-year smelter in the top lead producing province of Henan restarted operations in the beginning of the month. "We closed for repairs before the Lunar New Year holidays. We already restarted some production," a sales manager at the smelter said. China is the world's top lead and zinc producer. Lead concentrates to China are priced on London Metal Exchange lead price and silver prices , a common by-product of lead concentrates. China mined 225,000 tonnes of lead in concentrate in March, double from February 2010 and up 28.6 percent from March 2010. A trading manager at a large lead and zinc producer said plants were buying more locally produced lead concentrates, for which smelters paid about 2,000 yuan ($306) per tonne less than prices for imported concentrates now. China produced 458,000 tonnes of zinc in March, up 11.7 percent from March 2010 and 15.4 percent from February 2011. But high stocks may discourage some smelters from running full rates. He estimated up to 1.5 million tonnes of refined zinc may be stored in private and public warehouses in China. "The supply won't stop even if all Chinese zinc smelters halt production for three months," the trading manager said. Nickel production rebounded 16.4 percent to 19,634 tonnes in March, after a 23.4 percent fall in February from record 22,015 tonnes in January 2011. March output rose 37.5 percent from a year ago.

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