UPDATE 1-China publishes revitalisation plan for metals

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BEIJING/HONG KONG, May 11 (Reuters) - China will restrict new aluminium projects for three years and push for consolidation of base metals production, the State Council said on Monday, as it published a plan to revitalise the sector.

This policy may affect a plan of Aluminum Corp of China Ltd

(Chalco) (2600.HK) (601600.SS), which has asked Beijing for approval to add 250,000 tonnes of primary aluminium capacity at its Pingguo plant in Guangxi. The plant now has 140,000 tonnes of primary aluminium capacity.

The long-expected plan, a draft of which was published in February, will seek to have between three and five big firms by 2011, with the top 10 firms controlling 90 percent of copper production by 2011, 70 percent of aluminium, 60 percent of lead and 60 percent of zinc.

"These are generally positive initiatives. The plans for copper and zinc are very positive," ANZ's senior commodities analyst Mark Pervan said.

"The zinc market is especially fragmented and putting 60 percent of the industry in the hands of a few producers will mean a more disciplined supply response, and may boost prices."

Chalco's spokesperson, Liu Qiang, did not comment on the Pingguo's expansion plan.