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ETF News

METALS-Copper slips on dollar, China demand worries

 * China demand for refined copper down in October
 * Signs that potential aluminum ETP priced into market
 * Codelco [CODEL.UL] hikes annual physical copper premiums
 * Coming up: U.S. Q3 growth data on Tuesday
 (Recasts with New York closing copper price, adds New York dateline/byline and
analyst comments)
 By Chris Kelly and Rebekah Curtis
 NEW YORK/LONDON, Nov 22 (Reuters) - Copper ended lower on Monday after a
slide in Chinese imports reinforced concerns over the country's economy-cooling
efforts while fears of euro zone debt contagion pushed the dollar up on
safe-haven buying.
 The industrial metal emerged as one of the worst performers in the broader
commodities complex, ending near session lows after data showed refined copper
imports by China, the top consumer of the metal, fell nearly a third in
October. [ID:nTOE6AL052
 The data reflected worries in the market about China's near-term demand
outlook for raw materials after the country on Friday raised cash reserve
requirements for banks, the second such move in a fortnight, as it aims to tame
inflation. [ID:nL3E6MJ0N8]
 "This is all concern about tighter monetary policy in China," Bart Melek,
global commodity strategist with BMO Nesbitt Burns in Toronto, said of the red
metal's start to the week.
 "The concern is, do the Chinese implement some sort of price control plan
to keep these commodity prices from moving any higher," he said.
 On the London Metal Exchange (LME), copper for three-months delivery
CMCU3 ended down $114 at $8,290 a tonne, near the bottom of its $8,210 to
$8,516.75 range.
 COMEX copper for December delivery HGZ0 sank 8.20 cents, or 2.1 percent,
to settle at $3.7515 per lb, also near its session low at $3.7260.
 COMEX copper volumes remained brisk despite the onset of a
holiday-shortened week. The total stood at 51,396 lots by 1:59 p.m. EST (1859
GMT), nearly 9 percent above the 30-day average near 47,300 lots, Thomson
Reuters preliminary data showed.
 New York commodity markets will be shut on Thursday for the U.S.
Thanksgiving Day holiday. Trading will resume on Friday.
 Copper held firm overnight, tracking upside momentum in the euro, after the
European Union and International Monetary Fund agreed to a three-year bailout
plan for debt-strapped Ireland. [ID:nLDE6AL00M] [USD/]
 But as that initial optimism faded, so did the metal's gains, as concerns
about possible contagion to other highly indebted states in the 16-country euro
zone grew and Chinese demand worries persisted.
 "The Ireland situation is affecting risk appetite but there are other
things impacting copper -- worries about a slowdown in China, with the China
copper imports being relatively low in the most recent data," Standard
Chartered analyst Dan Smith said. [.EU]
 Still, signs of Asian demand were well and strong.
 The world's top copper producer, Chile's Codelco [CODEL.UL], upped annual
physical copper premiums for Chinese buyers by 35 percent, to $115 a tonne in
2011. [ID:nL3E6MM0LX]
 ETPS PRICED IN
 Signs have emerged that prospective exchange-traded products (ETPs) or
funds (ETFs) for LME metals, like aluminum, are being priced in to metals
markets, even though they have not yet been approved, Standard Bank said.
 "While some of the tightness may be related to the impact of warehousing
deals, the recent movement suggests that fears over the impact of ETFs on metal
availability may also be manifesting itself in the aluminum spreads," Standard
Bank analyst Leon Westgate said in an note.
 The premium on LME aluminum for delivery in 27 months has narrowed against
the benchmark three-months contract to $90 from around $120 last week, LME data
shows.
 Elsewhere, LME warehouse copper stocks kept trending lower, down 825 tonnes
to 359,000 tonnes, the lowest in over a year.
 Concern about supplies in the near term have pushed copper into a $23.5 a
tonne backwardation -- a premium for cash material over the three-month
contract MCU0-3 -- compared with a discount of $20 a tonne at the end of
October.
 Among other metals, aluminum CMAL3 ended up $24 at $2,288 a tonne, while
zinc CMZN3 shed $22 to close at $2,138 a tonne. Lead CMPB3 ended down $27
at $2,250 a tonne. Tin CMSN3 slumped $700 to end at $24,300 a tonne and
nickel CMNI3 fell $250 to $21,600 a tonne.
 Metal prices at 1922 GMT:
 COMEX copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
 Metal            Last      Change  Pct Move   End 2009   Ytd Pct
                                                         move
 COMEX Cu       376.70       -6.65     -1.73     334.65     12.57
 LME Alum      2280.00       16.00     +0.71    2230.00      2.24
 LME Cu        8275.00     -129.00     -1.53    7375.00     12.20
 LME Lead      2250.00      -27.00     -1.19    2432.00     -7.48
 LME Nickel   21575.00     -275.00     -1.26   18525.00     16.46
 LME Tin      24300.00     -700.00     -2.80   16950.00     43.36
 LME Zinc      2138.00      -22.00     -1.02    2560.00    -16.48
 SHFE Alu     16400.00      -90.00     -0.55   17160.00     -4.43
 SHFE Cu*     63310.00     -700.00     -1.09   59900.00      5.69
 SHFE Zin     17800.00     -345.00     -1.90   21195.00    -16.02
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
  (Additional reporting by Melanie Burton in London; Editing by Michael Taylor,
Anthony Barker and Dale Hudson)


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