MARKETS-METALS (UPDATE 4)
* Concerns about Chinese demand weigh
* LME copper stocks down nearly 30,000 T since March 1
* Nickel stocks at lowest since late December
(Adds official prices)
By Pratima Desai
LONDON, March 19 (Reuters) - Copper climbed on Friday as investors expecting stronger global economic and demand growth bought the industrial metal, but concern about demand from top consumer China capped gains.
Benchmark copper on the London Metal Exchange traded at $7,509 a tonne in official rings from $7,486 at the close on Thursday. The metal used in power and construction is up about 20 percent since early February.
Analysts say the market is looking at signs of stronger economic growth in the United States, the world's largest economy, and translating that into stronger demand for industrial metals.
"There is more confidence that the economy is going to recover, so demand will outweigh supply," said Eugen Weinberg, commodities analyst at Commerzbank.
But dollar strength weighed on sentiment, as the euro slid due to nagging concerns about Greece's fiscal problems. Dollar-denominated metals become more expensive for holders of other currencies when the dollar rises.
Another risk for industrial metals is the extent and timing of fiscal tightening in China, which is said to account for more than 30 percent of global copper demand -- estimated this year at above 18 million tonnes.
"For the next leg up, we do need concerns about China to be alleviated," said Max Layton, analyst at Macquarie.
"For people taking a longer term view there will be opportunities to start accumulating on any dips triggered by macroeconomic weakness."
STAINLESS IMPROVEMENT A positive for copper prices was news that Swedish miner and smelter Boliden will this week shut Europe's fourth-biggest copper smelter, in Finland, as a strike by port workers hit concentrate supplies. However, the smelter is due to restart within days.
Stocks of copper in London Metal Exchange warehouses also helped boost the metal. They have fallen nearly 30,000 tonnes since March 1 to 522,975 -- the lowest since the middle of January.
Three-month nickel hit $22,900 a tonne, the highest since March 4. It traded at $22,700 a tonne compared with $22,760 at the close on Thursday.
Stocks of nickel in LME warehouses are down 8,724 tonnes since early February to 157,752 tonnes, a level last seen at the end of last year. Stainless steel mills account for about two-thirds of global nickel demand.
"This shift in inventory dynamic was a clear signal that the nickel market was in deficit," Barclays Capital said in a note. "Decline in stocks has been accompanied by reports of improving production levels in the global stainless steel sector."
Consultants Brook Hunt told Reuters in an interview on Thursday that the nickel market this year could see a 10,000 tonne deficit. The nickel market this year is estimated at around 1.4 million tonnes.
Industry consultants CRU Group expects the nickel market to see a deficit for the first time in four years.
Steel material zinc traded at $2,319 a tonne from $2,333, battery material lead at $2,237 a tonne $2,245 and aluminium at $2,266 a tonne from $2,276.
Tin traded at $17,725 a tonne from Thursday's last bid at $17,790.
For stories on nickel click on Metal Prices at 1315 GMT Metal Last Change Percent Move End 2009 Ytd Percent
move COMEX Cu 339.50 0.75 +0.22 334.65 1.45 LME Alum 2266.00 -10.00 -0.44 2230.00 1.61 LME Cu 7510.00 24.00 +0.32 7375.00 1.83 LME Lead 2234.00 -11.00 -0.49 2432.00 -8.14 LME Nickel 22550.00 -210.00 -0.92 18525.00 21.73 LME Tin 17675.00 -75.00 -0.42 16950.00 4.28 LME Zinc 2317.00 -16.00 -0.69 2560.00 -9.49 SHFE Alu 16850.00 175.00 +1.05 17160.00 -1.81 SHFE Cu* 60230.00 690.00 +1.16 59900.00 0.55 SHFE Zin 18965.00 250.00 +1.34 21195.00 -10.52 ** 1st contract month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07
