April 10, 2017 / 10:38 AM / 3 years ago

METALS-Zinc hits three-month low as supply worries ease

 (Updates with closing prices)
    By Eric Onstad
    LONDON, April 10 (Reuters) - Zinc hit a three-month low on
Monday and copper also fell as supply concerns eased and demand
remained weak in top metal consumers such as China.
    Shortages of zinc concentrate - partly processed ore - are
easing, according to a report by the Chinese state-supported 
research institute Antaike cited by Commerzbank.
    Zinc prices touched a peak of $2,980.50 a tonne in
mid-February on worries that major mine closures last year would
lead to severe shortages.
    "Smelters are apparently able to secure sufficient supply so
long as they are prepared to pay the requested prices," the
German bank said in a note.
    "Globally speaking, zinc supply has already been rising
again since September." 
    *ZINC: London Metal Exchange three-month zinc slid
2.7 percent to close at $2,618 a tonne, the weakest since Jan.
6. Also pressuring the market was weakness in Chinese steel
prices and news that two flood-hit mines in Peru were ready to
    COPPER: LME copper dropped 1.5 percent to end at
$5,747 a tonne, adding to small losses in the previous session,
having broken support at its 100-day moving average at $5,800 a
    COPPER SUPPLY: Prices have faltered since shipments resumed
from the world's two biggest copper mines after being disrupted
earlier this year.
    "The supply disruptions that we have seen were short-term
dynamics and did not create real tightness in the market. We
wouldn't be too surprised if the copper market ends the year in
a slight surplus," said Gianclaudio Torlizzi, partner at
consultancy T-Commodity in Milan.
    "I think that the market is digesting the slowing down of
the global picture ... which is not good for the state of demand
in the second half of the year."
    * COPPER SPREADS: The discount of cash LME copper to the
three-month contract CMCU0-3 was $30.85 a tonne after closing
on Friday at $35.25, the biggest discount since June 2013,
indicating that supplies were adequate. 
    * COPPER SPECULATORS: Hedge funds and money managers cut
their net long position in U.S. copper futures for the first
time in three weeks, data showed. 
    * NICKEL: The LME price ended unchanged at $10,180,
balanced by potentially bullish and bearish news. A suspended
Philippine nickel miner has asked the president to allow it to
ship ore stockpiles after some cargoes were seized.
    * NEW CALEDONIA: Cyclonic winds and heavy rain buffeted New
Caledonia on Monday, prompting residents of the French South
Pacific territory to seek shelter and halt mining of nickel, its
most important export.
    * PRICES: LME aluminium shed 1.8 percent to close at
$1,926.50 a tonne, lead added 0.3 percent to finish at
$2,258 and tin rose 0.2 percent to $20,275.
 BASE METALS PRICES                                  
 Three month LME copper                          5807
 Most active ShFE copper                        47170
 Three month LME aluminium                     1956.5
 Most active ShFE aluminium                         1
 Three month LME zinc                            2662
 Most active ShFE zinc                          22020
 Three month LME lead                            2244
 Most active ShFE lead                              7
 Three month LME nickel                         10175
 Most active ShFE nickel                           18
 Three month LME tin                            20225
 Most active ShFE tin                               2
 BASE METALS ARBITRAGE                               
 LME/SHFE COPPER               LMESHFCUc3      540.86
 LME/SHFE ALUMINIUM            LMESHFALc3     -1596.7
 LME/SHFE ZINC                 LMESHFZNc3      259.81
 LME/SHFE LEAD                 LMESHFPBc3    -2177.94
 LME/SHFE NICKEL               LMESHFNIc3        1531
 (Editing by Pritha Sarkar and Mark Potter)
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