October 16, 2019 / 11:44 AM / a month ago

METALS-Copper dips as U.S.-China trade battle seen harming global growth

    * GRAPHIC-2019 asset returns: tmsnrt.rs/2jvdmXl
    * Nickel hits lowest since Aug 30 

 (Adds closing prices, adds nickel)
    By Zandi Shabalala
    LONDON, Oct 16 (Reuters) - Copper fell to a one-week low on
Wednesday on rising concerns about the health of the global
economy as the U.S.-China trade row showed no signs of abating,
weighing on demand for metals.
    The International Monetary Fund said the trade conflict
between the United States and China would cut 2019 global growth
to its slowest since the 2008-2009 financial crisis, but said
output would rebound if tariffs were removed.             
    The warning comes after the world's two largest economies
made little progress in negotiations last week, prolonging a row
that has unnerved financial markets and sapped demand for metal.
    "The initial excitement about a possible trade deal has
calmed down and the market has realised that getting a deal will
be much more complicated," said Natixis analyst Bernard Dahdah. 
  
    Three-month copper on the London Metal Exchange (LME)
        closed 0.7% lower at $5,730 a tonne, having declined by
a similar margin in the previous session.  
        
    CHINA GROWTH: A Reuters poll showed China's economic growth
is expected to slow to a near 30-year low this year and cool
further in 2020, even as it steps up stimulus.             
    U.S.-CHINA: U.S. President Donald Trump on Wednesday said he
was not likely to sign any trade deal with China until he met
Chinese President Xi Jinping at the APEC Forum in Chile.
            
    INVENTORIES: On-warrant copper inventories in LME-approved
warehouses rose by 7,950 tonnes to 211,875, the highest since
Sept. 19. MCUSTX-TOTAL
    WAGE DEAL: Copper miner Antofagasta PLC          reached a
labour agreement with a union of supervisors at its flagship Los
Pelambres mine in Chile, easing supply concerns.             
    PERU SUPPLY: In Peru, the government authorised the
intervention of the armed forces and police to unblock access to
one of the country's largest copper mines, after owner Chinese
miner MMG Ltd           said it may have to cease production at
the site.             
    TIGHTER MARKETS: ING bank analysts said mine supply
disruptions from South America could tighten the market over the
fourth quarter but prices would likely be dictated by demand,
given the softer economic environment and uncertainty.
    FEE INCREASES: The LME will raise its trading and clearing
fees 8% from January 2020, its first increase in five years to
fund new projects and keep up with inflation.             
    NICKEL: Nickel         shed 3.2% to $16,420 a tonne, its
lowest for more than six weeks. Headline stocks of nickel on the
LME fell to their lowest since January 2012 to 91,062 tonnes.
MNISTX-TOTAL
    The disconnect between physical nickel market weakness and
exchange tightness "presents a major downside risk to prices,
alongside the global growth risks, and we continue to see nickel
price risks as skewed to the downside", said analysts at Citi.  
    PRICES: LME aluminium         was unchanged $1,728 a tonne,
zinc         slipped 0.2% to $2,434, lead         added 0.5%
higher to $2,160, tin         was bid up 0.9% to $16,850.    
    

 (Additional reporting by Mai Nguyen; Editing by David Evans and
Edmund Blair)
  
 
 
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