Mon Feb 14, 2011 3:09pm EST
* Copper, tin rally to record highs
* China copper imports trigger demand-driven rally
* Rusal says institutions eye UK ETF listing in weeks
* Coming up: China consumer price index for January
(Recasts, adds New York dateline/byline, updates with New York closing copper
price, adds analyst comments)
By Chris Kelly and Rebekah Curtis
NEW YORK/LONDON, Feb 14 (Reuters) - Copper rallied to a record high on
Monday, after a surprise jump in Chinese imports reinforced prospects for
robust global demand and raised hopes of extended restocking by the world's top
consumer.
Copper, often viewed as a barometer for the global economy due to its use
in construction and power, posted its biggest daily gain in about two weeks, as
the data suggested China's growth remained intact despite recent tightening
measures.
"It could very well be that the Chinese economy is running hotter than
anyone thinks," said Bart Melek, vice president and director of commodities
with TD Bank Financial Group.
London Metal Exchange (LME) copper for three-month delivery CMCU3
extended gains to a record $10,170.25 per tonne in after-hours trade, having
closed up $199 at $10,160, matching the previous high.
COMEX copper for March delivery HGH1 added 9.25 cents, or 2 percent, to
settle at $4.6285 per lb. The session range ran from $4.5435 to $4.6345, with
the high coming within a hair of last week's record at $4.6375.
The bullishness spread to other metals, lifting tin CMSN3 to a record
high of $32,460 a tonne. It ended up $675 at $32,450, as supply constraints in
Indonesia continued to support prices. [ID:nLDE70R14Y] [ID:LDE71D0VR]
Preliminary Chinese trade data showed imports of unwrought copper and
semi-finished copper products rose to 364,420 tonnes in January.
The volume, which was up 5.7 percent from December and 24.7 percent from
January 2010, was the highest since September and marked the third successive
month analysts had expected imports to be under pressure from relatively low
Chinese prices. [ID:nTOE71D037]
"The market's taken these numbers in a very bullish way," said Robin Bhar,
an analyst at Credit Agricole. "China's appetite is insatiable."
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic of China's copper monthly imports:
link.reuters.com/hyh97r
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Investors will focus next on Chinese inflation data due on Tuesday amid
worries that any tougher stance by Beijing to rein in inflation could affect
metals demand. [ID:nTOE706030]
Talk swirled around financial markets that China's consumer prices may have
risen 4.9 percent in the year to January, well below the consensus forecast of
5.3 percent. [ID:nTOE71D01T]
"If we get a strong number ... say around 5.8 to 6, and the core moves up
meaningfully above 2 percent, we are going to be worried about a significant
tightening of Chinese monetary policy, and some of these base metals could be
left wondering where do we go from here," TD Bank's Melek said.
LME copper stocks increased 5,050 tonnes to a six-month high of 401,775
tonnes, continuing a recent climb that has kept optimism about demand in check.
<0#LME-STOCKS>
ETFS IN FOCUS
Aluminium CMAL3 ended at $2,514 a tonne from $2,496.
LME warehouse stocks dipped 4,725 tonnes to 4,594,725 tonnes, although they
remain within reach of a record high of 4,640,750 tonnes hit in January 2010.
Market sources said expiring finance deals were boosting stock levels.
Canceled warrants -- metal tagged for removal from warehouses -- rose by
nearly 50,000 tonnes, having climbed by double that amount in Detroit since
Thursday, pointing to a pick-up in demand from the auto sector. MAL-STOCKS
"Strong auto production growth is good news for many commodities,
accounting for about 25 percent of aluminium (including secondary), 25 percent
of zinc, 15 percent of steel and 10 percent of copper usage," Macquarie said in
a note.
Also grabbing investors' attention, Russia's United Company RUSAL Ltd
( 0486.HK)(RUAL.PA), the world's largest aluminium producer, said an aluminium
exchange-traded fund (ETF) could be launched soon in Britain. [ID:nHKU000446]
"The question is, will the ETF launch mop up that excess?" Bhar said of LME
stocks.
Rusal said it saw steady output growth in 2011, driven by strong demand
from China and a rebound in North America. [ID:nTOE71D00O]
Metal Prices at 1913 GMT
COMEX copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2010 Ytd Pct
move
COMEX Cu 462.95 9.35 +2.06 444.70 4.10
LME Alum 2514.00 18.00 +0.72 2470.00 1.78
LME Cu 10155.00 194.00 +1.95 9600.00 5.78
LME Lead 2639.00 79.00 +3.09 2550.00 3.49
LME Nickel 28895.00 570.00 +2.01 24750.00 16.75
LME Tin 32450.00 675.00 +2.12 26900.00 20.63
LME Zinc 2520.00 55.00 +2.23 2454.00 2.69
SHFE Alu 17125.00 35.00 +0.20 16840.00 1.69
SHFE Cu* 75580.00 660.00 +0.88 71850.00 5.19
SHFE Zin 19470.00 330.00 +1.72 19475.00 -0.03
** 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 Dale Hudson)