RTRS: METALS-Base metals plumb multi-year lows as China worries persist
* Further supply cuts needed to balance markets - analysts
* Nickel, zinc seen as casualties of China steel woes-trader (Recasts, updates prices, adds comment/detail; changes dateline)
By Maytaal Angel
LONDON, Nov 19 (Reuters) - Base metals fell to multi-year lows on Thursday as worries that supply cuts are not enough to balance a market battling weak demand in top metals user China.
The worries overshadowed the impact of a slightly softer dollar, which fell after the Federal Reserve flagged a rate hike next month, but also indicated further moves would then depended on the economy continuing to perform well.
A weak dollar makes dollar-priced metals cheaper for non-U.S. investors
"The dollar on a day to day basis drives the price but the bigger picture is not enough production cutbacks and we still see very sluggish physical demand in China and elsewhere, in what should be a pretty robust period," said Societe Generale analyst Robin Bhar.
Three-month copper on the London Metal Exchange fell to the weakest since May 2009 at $4,573 a tonne, and traded down 0.2 percent in official midday rings at $4,600.
In China, data on Tuesday showed home prices edged up 0.1 percent in October from a year earlier, the first rise in 14 months, but most investors remain worried over the economy's overall health following several weak readings this month.
U.S. bank Goldman Sachs said commodity prices could see another sharp drop as an adjustment in supplies from energy, metals and agricultural producers remains insufficient in the face of weaker demand at key consumers like China.
Chinese steel demand shrank around 6 percent in January-October, according to the China Iron and Steel Association, reflecting slower industrial activity as the world's No. 2 economy heads for its weakest growth in 25 years.
Stainless steel ingredient nickel hit its lowest in seven years at $8,940 a tonne and traded down 1.9 percent in rings at $8,930; while galvanising metal zinc hit its lowest in six year at $1,487.50, and traded down 0.9 percent in rings at $1,504
"The view is that we're going to see some destocking and production cuts at steel mills, so zinc is mostly likely a casualty from the non ferrous side. The same for nickel," said a trader in Shanghai.
Nickel smelter developers are putting projects on hold as they struggle to get financing with metal prices near their lowest in more than a decade.
Lead fell to its lowest in 5-1/2 years at $1,566 a tonne. It was last bid down 1 percent in rings at $1,574, while aluminium traded down 0.7 percent in rings at $1,461.50, having earlier veered towards a recent six year low of $1,457.
Twelve U.S. senators urged the Obama administration to enforce duties on Chinese aluminium extrusions, used for products ranging from car parts to window panes.
Shfe aluminium closed below the 10,000 yuan mark for the first time, in a downward trend that is expected to worsen without large output cuts by producers.
