* Cyprus parliament likely to reject plans agreed by eurozone officials
* Euro falls to 3-month low vs dollar on Cyprus problems
* Coming Up: U.S. house starts; 1230 GMT
By Susan Thomas
LONDON, March 19 Copper steadied, but remained near four-month
lows on Tuesday as equities and the euro sank versus the dollar on investor
nervousness about a potential banking collapse in Cyprus.
A lack of demand for copper by buyers in top commodities consumer China also
worried investors, especially since prices were not far off their lowest for the
Three-month copper on the London Metal Exchange was $7,568 a tonne
in official rings from $7,576 at the close on Monday. Copper earlier fell to
$7,521.25 a tonne, its lowest since Nov. 9, from a session high above $7,600.
"There's ongoing nervousness on the Cyprus situation and we're also getting
bits of other data coming out which are slightly bearish," said Citi analyst
"It's a poor macro overlay and then underlying fundamentals don't look great
The euro fell, as did European equities, as Cyprus's parliament was set to
reject a controversial bank deposit levy crucial for the country to secure
financial aid, but which has raised fears of fresh euro zone instability.
A weaker euro makes dollar-priced metals more expensive for holders of the
"Last summer's on-again off-again European crisis seems to be rearing its
ugly head again as in the past month we have seen worries over Spain and Italy
re-emerge followed by the Cypriot debacle," RBC said in a research note.
"With most things on hold till more clarity out of Europe materializes, we
expect today to be soft, but do expect some type of recovery in the coming
Also muting buying interest were China's near record-high domestic copper
In LME-registered warehouses copper inventories were close to 9-1/2 year
highs, and nickel stocks neared their highest since February 2010, signalling a
lack of demand.
WAITING IN VAIN
Markets waited in vain for China to resume buying metals after its Lunar New
Year holiday, and as its once in a decade leadership transition winds up and the
seasonally strongest second quarter gets underway.
"I think the hopes that China growth would accelerate this year seem to be
diminishing. China is changing and you are not going to see these double-digit
growth rates going forward," Wilson said.
"A lot of the expectations over construction activity in China now I think
are being scaled back. We're not now expecting any acceleration in
China accounts for at least 40 percent of global copper consumption, with
the construction industry a particularly crucial source of consumption growth.
Copper is used widely in construction and power cables.
Recent Chinese government pronouncements on the property market add to the
sense that manufacturing growth will be muted in 2013.
Last week, People's Bank of China Governor Zhou Xiaochuan said the bank
would reinforce efforts to contain house price rises in 2013 as part of broad
government efforts to restrain real estate speculation.
A report showing U.S. housing starts rose, and new permits for construction
climbed to the highest level since 2008, helped support copper, although the
U.S. housing sector accounted for just 9 percent of global primary copper
consumption last year.
Commerzbank said in a research note that metals prices were considerably
underperforming other cyclical commodities such as energy sources.
"In our opinion the price slide is exaggerated and without fundamental
justification. The current low prices offer attractive opportunities to buy," it
Three-month tin, untraded in rings, was bid at $23,250 from $23,100
at the close on Monday.
Zinc was $1,921 from $1,919, lead was $2,180 from $2,185,
aluminium was $1,945.5 from $1,936 and nickel was $16,655 from
The global nickel market was in surplus by 17,000 tonnes in January 2013, a
monthly bulletin from Lisbon-based International Nickel Study Group (INSG)
showed on Tuesday. Nickel stocks held by producers were at 87,400 tonnes in
December 2012, down from 83,700 tonnes in November.
Metal Prices at 1318 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2012 Ytd Pct
COMEX Cu 341.90 0.05 +0.01 365.25 -6.39
LME Alum 1943.50 7.50 +0.39 2073.00 -6.25
LME Cu 7573.25 -2.75 -0.04 7931.00 -4.51
LME Lead 2186.00 1.00 +0.05 2330.00 -6.18
LME Nickel 16655.00 50.00 +0.30 17060.00 -2.37
LME Tin 23270.00 170.00 +0.74 23400.00 -0.56
LME Zinc 1923.00 4.00 +0.21 2080.00 -7.55
SHFE Alu 14655.00 -40.00 -0.27 15435.00 -5.05
SHFE Cu* 55000.00 -390.00 -0.70 57690.00 -4.66
SHFE Zin 14850.00 -45.00 -0.30 15625.00 -4.96
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07