* China central bank declines cash injection for third day
* Chinese manufacturing picks up in October
* Reuters poll shows analysts bearish on copper for 2014
By Eric Onstad and Harpreet Bhal
LONDON, Oct 24 Copper dipped to its lowest level
in nearly two weeks on Thursday as persistent concerns about
credit tightening in top metals consumer China offset upbeat
manufacturing growth there.
A surprise setback in business growth in the euro zone also
helped dampen investor appetite for copper and other industrial
Three-month copper on the London Metal Exchange
touched its lowest level since Oct 11 at $7,137 a tonne during
the session, before staging a rebound in late-trade to end at
$7,175 a tonne, flat from a last bid of $7,171 on Wednesday.
The market remained concerned about a cash crunch in the
world's second-biggest economy after China's central bank
declined to inject cash for a third day.
"If you look back at the Chinese experience in 2007, this is
quite similar. The initial spike in repo rates was followed by
some aftershocks that were caused by stealth tightening," said
Vicky Sanders, head of analytics sales at broker Marex Spectron.
"It seems to me a similar situation is happening in China at
the moment and any tightening in China is a challenge for base
Copper prices have traded in a $7,000-7,420 band since late
August and remain down by about 9 percent this year.
The metal is expected to end the year 8 percent lower, and
tumble further in 2014 as demand struggles against strong supply
growth from new and existing mines, a Reuters poll showed.
Helping limit falls, however, was a survey showing activity
in China's giant manufacturing sector picked up in October,
suggesting the economy may have stabilised even though a strong
rebound remains elusive.
"This figure reflects the trend towards improving economic
data in China and shows that the country's economy remains on
the up," Commerzbank analysts said in a note.
Also weighing on prices were expectations of a surge in
supply in the market. Analysts polled by Reuters expect the
copper market to post a surplus of 182,000 tonnes this year,
before ballooning to 328,000 tonnes in 2014.
Currently the copper market is largely in balance, but
rising supply will shift that next year, said Paul Dewison of
"The fourth quarter we see as being sharply in surplus, as
concentrate stocks go to refined (metal). Longer term, we are
looking at surplus, at about 350,000-400,000 tonnes in both 2014
and 2015," he told the Reuters Global Base Metals Forum.
LME nickel ended at $14,650 a tonne, from a close of
$14,595 on Wednesday, after strong gains in recent weeks on
worries about a planned export ban in Indonesia.
Despite falling 1.7 percent on Wednesday, nickel is still
the best-performing LME base metal this month with a 6 percent
Sanders said more gains were likely. "A lot of the move
higher we've seen in nickel over the last couple of weeks has
been short-covering. The nickel market is still short so this
Aluminium ended at $1,861 from a close of $1,844 on
Wednesday, zinc closed at $1,936 from $1,932 and tin
ended at $22,875 from $22,800.
Lead closed at $2,173.50 from a last bid of
$2,172.50 on Wednesday.
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
Three month LME tin