* Closures seen as nickel prices bite into cost curve-consultancy
* LME copper inventories climb by over 16,000 tonnes (Updates with closing prices, adds quotes)
By Eric Onstad
LONDON, June 30 (Reuters) - Nickel rebounded from a six-year low on Tuesday while other metals fell as speculators sold off on concerns over excess supply, uncertainty in top metals consumer China and the Greek debt crisis.
Earlier in the session benchmark LME nickel slid nearly 9 percent to hit $10,795 a tonne, its weakest level since April 2009, but it rebounded on bargain hunting and short-covering to close up 1.1 percent at $11,980. ShFE nickel fell by its 5 percent limit.
The panic selling in nickel was sparked by the Shanghai exchange broadening delivery options, causing investors to rush for the exit.
“This is the one metal that has the best upside potential in our view, though it is a difficult one for people to stay in,” said Guy Wolf, global head of market analytics at broker Marex Spectron.
“Nickel is not going to be one for the faint-hearted. The fundamentals look poor right now but the lesson from nickel over the last 18 months is that things can change very quickly,” he told the Reuters Global Base Metals Forum.
On Monday, the Shanghai Futures Exchange (ShFE) approved nickel from Russian producer Norilsk for delivery against its futures contracts, following concern that domestic suppliers would fail to provide enough supply.
Nickel peaked above $21,000 in May last year on the London Metal Exchange, as investors bet that China’s vast stainless steel industry would use more of the metal after Indonesia banned ore exports last year, but it has since fallen by half.
“We’re now a fair way down into the cost curve, so we should start seeing (production) closures,” said analyst Matt Fusarelli of AME Group in Sydney.
Other metals were hit in the scramble to adjust positions ahead of the end of the quarter and half year, as well as an expiry of options on Wednesday.
“This week is carrying a lot of event risk, in more ways than one. The CTAs (commodity trading advisors) are looking to run the metals down where they can,” said Robin Bhar, head of metals research at Societe Generale in London.
“Things are very volatile because of the macro situation with Greece, with China uncertainty, we’ve also got U.S. non-farm payrolls on Thursday, plus all of the end of period positioning and the LME options expiry.”
Tin ended down 3.3 percent at $13,925 after touching a low of $13,365, the weakest in nearly six years.
LME copper closed 0.4 percent weaker at $5,765 a tonne after data showed LME inventories rose by more than 16,000 tonnes.
Zinc finished down 0.9 percent at $2,000 a tonne after touching a 15-month low of $1,964.50, while lead gave up 1.3 percent to end at $1,760.
Aluminium, untraded in closing rings, was bid down 0.6 percent at $1,691 a tonne.
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin
$1 = 6.2085 Chinese yuan Additional reporting by Melanie Burton and A. Ananthalakshmi, editing by David Evans