January 28, 2019 / 5:06 AM / a year ago

METALS-Aluminium falls as U.S. lifts sanctions on Rusal

 (Adds Shanghai closing prices, updates London prices)
    BEIJING, Jan 28 (Reuters) - London aluminium prices fell on
Monday after the United States formally lifted sanctions on
Russian aluminium producer United Company Rusal.

    The sanctions had sent London aluminium to a seven-year high
when they were announced in April last year amid fears of a
supply squeeze.
    Prices had since fallen back on expectations that the
measures would be withdrawn but added 2.7 percent last week amid
a surge in cancelled warrants, or orders to withdraw from London
Metal Exchange (LME) warehouses.
    There is likely to be little price support from top
aluminium consumer China in the near term, with the country
shutting down for the week-long Lunar New Year break early next
month.
    "This week end-user companies in eastern China have begun to
suspend production for the holiday and demand has turned
weaker," Jinrui Futures wrote in a note.
    Anticipated restarts to alumina production, including at
Norsk Hydro's Alunorte plant in Brazil, could keep pressure on
prices, it added.
    
    FUNDAMENTALS
    * ALUMINIUM: Three-month LME aluminium dropped as much as
1.4 percent to $1,892.50 a tonne shortly after the open before
recovering to $1,909 as of 0734 GMT. The most traded March
aluminium contract on the Shanghai Futures Exchange
closed down 0.3 percent at 13,485 yuan ($2,002.47) a tonne.
    * LME: The London Metal Exchange has lifted its suspension
on placing Rusal metal on warrant.
    * RUSAL: Shares in Rusal, which said Jean-Pierre Thomas had
resigned as chairman to comply with an imperative request from
the U.S. Treasury, rose by more than 5 percent in Hong Kong.

    * CHINA PROFITS: Earnings at China's industrial firms shrank
for a second straight month in December on slowing prices and
sluggish factory activity.
    * TRADE: Chinese Vice Premier Liu He will visit the United
States on Thursday and Friday for the next round of trade
negotiations with Washington.
    * OTHER METALS: LME copper edged down 0.2 percent to
$6,042 a tonne, while ShFE copper, tracking a jump in
London copper on Friday, hit a one-week high of 47,950 yuan a
tonne before closing at 47,540 yuan. Zinc was up 0.3
percent in London but all other LME metals were trading lower. 
    * For the top stories in metals and other news, click       
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    MARKETS NEWS    
    * Asian shares ticked up though they retreated from earlier
highs as relief on news of a deal to reopen the U.S. government
following a prolonged shutdown gave way to edginess before a key
round of Sino-U.S. trade talks.            
    PRICES
 BASE METALS PRICES                      0742 GMT
 Three month LME copper                    6041.5
 Most active ShFE copper                    47540
 Three month LME aluminium                   1908
 Most active ShFE aluminium                 13490
 Three month LME zinc                      2681.5
 Most active ShFE zinc                      21805
 Three month LME lead                      2106.5
 Most active ShFE lead                      17700
 Three month LME nickel                     11905
 Most active ShFE nickel                    95020
 Three month LME tin                        20665
 Most active ShFE tin                      147660
                                                 
 BASE METALS ARBITRAGE                           
 LME/SHFE COPPER             LMESHFCUc3    331.04
 LME/SHFE ALUMINIUM          LMESHFALc3  -1403.38
                                         
 LME/SHFE ZINC               LMESHFZNc3    273.73
 LME/SHFE LEAD               LMESHFPBc3    619.12
 LME/SHFE NICKEL             LMESHFNIc3   1760.65
                                         
 ($1 = 6.7342 Chinese yuan)

    
 (Reporting by Tom Daly; Editing by Joseph Radford and
Subhranshu Sahu)
  
 
 
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