Copper up half a percent, eyes China trade data

By Nick Trevethan

SINGAPORE (Reuters) - Shanghai copper rose 0.7 percent on Tuesday and London prices edged higher, with markets weighing fading confidence that Chinese buying is going into consumption against prospects of a big rise in February's import data on Wednesday.

Dealers looking ahead to Chinese trade numbers expect the refined copper component of the import data to exceed December's record 211,527 tonnes, but questions remain about how much of the material landing is feeding real demand and how much will gather dust in government stockpiles.

Shanghai copper for delivery in May rose 210 yuan, or 0.7 percent, to 29,230 yuan by the close.

Earlier prices rallied 1.7 percent as the market closed short positions for the May contract, and added significantly to June, boosting open interest by 4 percent at midday.

By the bell, more positions were closed and open interest stood at around 360,000 lots, down 0.5 percent on the day.

"People are closing positions in May where they were probably a little short. Outside that, it looks like more range trading capped at the recent high just above 30,000 yuan and the floor at 27,000 yuan," a trader in Shanghai said.

Copper on the London Metal Exchange added $19 to $3,630, having lost $112 in the previous session.

The difference between prices in London and Shanghai flipped back to a premium in favour of the Chinese market at 220 yuan, having traded at a discount on Monday.