April 3, 2018 / 5:26 AM / 19 days ago

METALS-London copper hits one-week top on steady China demand

 (Adds comment, updates prices)
    By Melanie Burton
    MELBOURNE, April 3 (Reuters) - London copper climbed to the
highest level in more than a week on Tuesday, supported by
stronger-than-expected manufacturing growth in top metals user
China.
    China's large state-owned manufacturers returned a solid
report card for March as authorities lifted winter pollution
restrictions and steel mills cranked up output with construction
activity swinging back into high gear.
    The picture was not quite as rosy among smaller to mid-size
Chinese companies, where manufacturing activity expanded at its
weakest pace in four months as export demand faltered.

    The London Metal Exchange was closed on Friday and Monday
for the Easter holiday.
    Investor worries over a tit-for-tat trade spat between the
United States and China were likely to fade out, INTL FCStone
said in a monthly report.  
    "Over the course of April, we think investors will come to
the conclusion that the trade issue is going to be a protracted
and complicated affair and will likely be "defanged," it said. 
    Metals traded on the London Metal Exchange will likely
strengthen in the second quarter when seasonal demand is
strongest, the brokerage said.
    
    FUNDAMENTALS
    * London Metal Exchange copper jumped 1.1 percent to
$6,790 a tonne at 0745 GMT, having peaked at $6,828, its highest
since March 22. Prices clawed their way back above the 200-day
moving average, saving them from coming under further technical
selling pressure. 
    * Shanghai Futures Exchange copper rose 0.2 
percent to 50,370 yuan ($8,016) a tonne.
    * CHINA TARIFFS: China has increased tariffs by up to 25
percent on 128 U.S. products, from frozen pork and wine to
certain fruits and nuts, escalating a dispute between the
world's biggest economies in response to U.S. duties on imports
of aluminum and steel.
    * U.S. ECONOMY: U.S. factory activity slowed in March amid
shortages of skilled workers and rising capacity constraints,
but growth in the manufacturing sector remains underpinned by
strong domestic and global economies.
    * COPPER SUPPLY: In a signal of plentiful copper mine
supply, China's top copper smelters on Friday lowered their
floor treatment and refining charges (TC/RCs) for copper
concentrate by 10.3 percent for the second quarter of 2018. 
   * SUMITOMO METAL OUTPUT: Sumitomo Metal Mining Co Ltd
, Japan's second-largest copper smelter, said it planned
to increase its refined copper output in the financial year that
started on April 1 by 4.6 percent from a year earlier.

    * CODELCO OUTPUT: Chile's state copper company, Codelco
          , produced 1.734 million tonnes of copper in 2017, its
second highest output, despite persistently low ore grades at
its aging mines.
    * FREEPORT: An Indonesian soldier was shot dead and two
separatist rebels killed in clashes with security forces near
the giant Grasberg copper mine in Papua operated by Freeport
McMoRan Inc FCX.N, an Indonesian military spokesman said on
Tuesday.
    PRICES    
 BASE METALS PRICES                0642 GMT            
 Three month LME copper                            6788
 Most active ShFE copper                          50360
 Three month LME aluminium                         2019
 Most active ShFE aluminium                       14080
 Three month LME zinc                            3266.5
 Most active ShFE zinc                            24765
 Three month LME lead                            2384.5
 Most active ShFE lead                            18700
 Three month LME nickel                           13515
 Most active ShFE nickel                         100790
 Three month LME tin                              21350
 Most active ShFE tin                            145400
                                                       
 BASE METALS ARBITRAGE                                 
 LME/SHFE COPPER               LMESHFCUc3        744.27
 LME/SHFE ALUMINIUM            LMESHFALc3       -622.53
 LME/SHFE ZINC                 LMESHFZNc3        336.19
 LME/SHFE LEAD                 LMESHFPBc3        152.36
 LME/SHFE NICKEL               LMESHFNIc3        308.45
 


($1 = 6.2839 Chinese yuan renminbi)

    
 (Reporting by Melanie Burton
Editing by Manolo Serapio Jr.)
  
 
 
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