December 21, 2016 / 7:11 AM / 3 years ago

METALS-London copper eases further from 1-month low on demand hopes

* China Nov copper exports lowest since Jan at 10,552 T

* China Nov aluminium exports drop 15 pct to 380,000 T

* China copper premiums fall $5 to near 2-month low (Updates prices)

By Melanie Burton

MELBOURNE, Dec 21 (Reuters) - London copper on Wednesday climbed further away from a one-month low hit earlier in the week, with investors betting that stronger U.S. and China economies next year would bolster demand for industrial metals.

Chinese metal exports fell in November, with its copper shipments at the lowest since January and its aluminium exports declining by 15 percent from a year ago, customs data showed on Wednesday.

“Looking ahead, weak seasonality towards year-end (e.g. market quietness and wait and see attitude by European consumers) and price consolidation will lend less support to the short-term demand picture,” Argonaut Securities said in a note.

Three-month copper on the London Metal Exchange had risen 0.8 percent to $5,548 a tonne by 0700 GMT, after closing little changed in the previous session. Volumes were modest, however, at less than 2,000 lots of turnover as liquidity drains away before Christmas.

LME copper on Monday fell to its lowest since Nov. 21 at $5,459 a tonne, although the metal is still set for gains of nearly 18 percent for the year.

LME copper inventories have jumped by nearly two thirds in the past fortnight as traders and metals firms deliver to clear positions ahead of year-end. The easier availability of metal pressured premiums for copper in Shanghai bond down by $5 to $80, the lowest since late October.

Shanghai Futures Exchange copper climbed 0.8 percent to 45,330 yuan ($6,523) a tonne.

The global world refined copper market showed a 15,000-tonne deficit in September, compared with a 156,000-tonne surplus in August, the International Copper Study Group (ICSG) said in its latest monthly bulletin.

In a step that could curtail metals demand at the edges, China’s central bank will tighten supervision of shadow banking businesses by including off-balance sheet wealth management products (WMPs) into its risk-assessment framework next year, sources with direct knowledge of the matter told Reuters.

China’s new aluminium smelter capacity additions and rising utilization rate will add to oversupply concerns and worries about an increase in Chinese exports, which will weigh on the aluminium price outlook at least in the short-term, Argonaut said on Wednesday.

China’s capacity utilisation rose to 84 percent in October, the highest in one year, Argonaut noted.

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 = 6.9493 Chinese yuan renminbi) (Reporting by Melanie Burton; Editing by Joseph Radford and Christian Schmollinger)

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