* China copper consumption still "anaemic"
* Metals demand expected to see seasonal uptick in early autumn
* PT Timah stops selling tin on spot mrk as prices are too low
By Silvia Antonioli
LONDON, Aug 7 (Reuters) - Copper rose to hit a 1-week high on Tuesday as the
dollar softened and market players were hoping the euro zone would take new
measures to shore up its faltering economy, but slack metals demand in top
consumer China kept a lid on prices.
Markets have enjoyed a strong run after the European Central Bank (ECB)
promised to step in and buy bonds to ease pressure on Spain and Italy, albeit
under strict conditions that are yet to be spelled out.
Expectations the ECB will act soon boosted the euro, which rose near a
one-month high against the dollar.
A weaker U.S. currency makes dollar-priced commodities such as metals more
affordable more holder of other units.
Three-month copper on the London Metal Exchange was up 0.8 percent
to $7,552 per tonne by 1020 GMT from $7,495 at the close on Monday. Prices have
so far shed more than 13 percent from the year's high hit in February.
"We are sitting here and waiting for the eurozone to deliver something," said
Andrey Kryuchenkov, analyst at VTB Capital.
"Markets are up on speculation that the ECB will make a move soon but copper
has been range-bound since the June sell-off and it is unlikely to move much
until you see the Chinese depleting their domestic warehouses. Chinese demand is
still anaemic at the moment."
Inventories of copper in China have risen drammatically since
the end of last year as the growth pace of the country started to slow down,
raising worries about the metals consumption prospects.
China's copper stocks could start to come down in the early autumn, when
usually demand sees a seasonal uptick, and as the Chinese authorities will likely
implement more measures to boost the economy, according to VTB Capital.
Two sources at smelters said China's copper smelters are planning to increase
refined copper exports following recent tax adjustments that have reduced their
export costs.
The move could shift thousands of tonnes of refined copper back to London
Metal Exchange warehouses and pressure global prices.
SLUGGISH DEMAND
Reflecting still sluggish demand from end users in China, premiums for
physical metal have slipped, Citi noted in a report. "Chinese copper premia have
... come off, now at $65 a tonne having reached a high of $85 in early July," it
said.
China's economy is facing downward pressure from shrinking external demand
and a domestic property market downturn.
A string of economic data from Chinese later this week should give some more
hints on the state of the world's second-largest economy.
Nickel was at $15,750 from $15,805 while tin was at $18,175
from $17,825.
Indonesia's PT Timah has stopped selling tin on the spot market
because of low market prices for the metal, cutting shipments this month from the
world's largest tin exporter.
Zinc, used in galvanizing was at $1,854 from $1,849 Monday's close
while battery material lead was at $1,989.75 from $1,891 and aluminium
was at $1,888.50 from a last bid of $1,878.
Metal Prices at 1024 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2011 Ytd Pct
move
COMEX Cu 341.65 2.75 +0.81 344.75 -0.90
LME Alum 1889.25 29.25 +1.57 2020.00 -6.47
LME Cu 7551.50 56.50 +0.75 7600.00 -0.64
LME Lead 1900.25 9.25 +0.49 2034.00 -6.58
LME Nickel 15781.00 -24.00 -0.15 18650.00 -15.38
LME Tin 18179.00 354.00 +1.99 19200.00 -5.32
LME Zinc 1857.00 8.00 +0.43 1845.00 0.65
SHFE Alu 15370.00 0.00 +0.00 15845.00 -3.00
SHFE Cu* 54860.00 250.00 +0.46 55360.00 -0.90
SHFE Zin 14610.00 -10.00 -0.07 14795.00 -1.25
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
