October 14, 2015 / 3:11 AM / in 5 years

METALS-London copper slips for second session on China outlook

* Codelco drops European premiums by 18 pct to $92 for 2016

* China boost to Sept imports offers some support to prices

* Coming up: euro zone industrial output at 0900 GMT (Adds comment, detail; updates prices)

By Melanie Burton

MELBOURNE, Oct 14 (Reuters) - London copper slipped on Wednesday for a second consecutive session as doubts persisted over the economic health of China, the world’s top consumer of metals, but a boost to copper imports supported prices.

Consumer inflation in China eased more than expected in September while producer prices fell for the 43rd straight month, data showed on Wednesday. The figures came after mixed China trade data that showed a sharper fall in China’s imports than expected, fanning concerns over growing deflationary pressures and an economic slowdown.

But an increase in China’s copper imports in September, hitting a 20-month high after staying flat in the previous three months, offered some price support. Buying was helped by price differentials favouring spot purchases and some shipments arriving ahead of the week-long Oct. 1 holiday.

“Even though some of the leading indicators on construction are pretty tepid ... there’s still quite a bit of buying, and we’d expect copper imports to be fairly strong for the next few months,” said analyst Matt Fusarelli at AME Group in Hong Kong.

Three-month copper on the London Metal Exchange had slipped 0.2 percent to $5,231 a tonne by 0702 GMT, extending modest losses from the previous session.

Prices have eased after they hit the highest in three weeks at $5,356 a tonne on Friday, but have been gathering slow upward momentum since marking a six-year low at $4,855 on Aug. 24.

Shanghai Futures Exchange copper dropped 0.4 percent to 39,630 yuan ($6,245) a tonne.

“On Chinese copper demand, domestic wire and cable orders have picked up in September, leading to steady bonded inventory draws. Reduced domestic production and scrap substitution may have also contributed to increasing demand for imported copper,” said Citi in a note.

As the world’s biggest metals industry event continues in London, top copper producer Codelco said it was bracing for a couple of difficult years as it slashes more costs and streamlines operations to prepare for further price weakness.

Codelco will offer its customers in Europe premiums of $92 per tonne in 2016, down 18 percent from $112 this year, reflecting weaker market conditions.

In other metals, a unit of China steel producer Tsingshan Group is set to triple its capacity to produce nickel pig iron in Indonesia as soon as May, an executive said, as the Southeast Asian nation pushes to win more profit from its mineral wealth.

PRICES

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 = 6.3472 Chinese yuan renminbi) ($1 = 6.3460 Chinese yuan renminbi) (Reporting by Melanie Burton; Editing by Ed Davies)

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