* Codelco premiums bolster sentiment

* OECD leading indicator underpins confidence

* LME copper stocks rise, aluminum inventories fall

(Recasts, updates with New York closing copper prices, adds NEW
YORK to dateline)

By Chris Kelly and Rebekah Curtis

NEW YORK/LONDON, Nov 9 (Reuters) - Copper closed higher on
Monday as demand prospects brightened after Codelco, the world's top
copper miner, raised premium charges for Asian customers in 2010,
while a weaker dollar provided an additional boost.

Copper for December delivery HGZ9 on the New York Mercantile
Exchange's COMEX division ended up 1.50 cents to settle at $2.9675 a
lb, after dealing in a session range between $2.9550 and $3.0020.

On the London Metal Exchange (LME), three-month copper futures
MCU3 ended up $50 at $6,540 a tonne.

Chile's Codelco raised its term premium for copper to the
Japanese port of Yokohama to $75 a tonne in 2010, and to $74 for
South Korean buyers, in anticipation of rising demand in parts of
Asia, industry sources said. [ID:nT230071]

These increases for Japan and South Korea were equivalent to
around 15.5 percent of 2009's levels.

"They're selling more and more of their mined copper to China,
India and Korea and it's a clear example of how much that region is
powering ahead, while Europe and the U.S. are not growing very
quickly," said Robin Bhar, an analyst at Calyon.

Further support stemmed from a struggling dollar, which fell to
a 15-month low against a basket of currencies .DXY after a weekend
G20 agreement to keep emergency stimulus spending in place indicated
global interest rates will remain low. [USD/]

"A lot of this buying is dollar-driven, but it's also from the
fact that interest rates are so low that fund managers are trying to
move capital into assets ... they are not earning interest anywhere
and investors are looking for physical assets," said Michael Gross,
futures analyst with Optionsellers.com in Tampa, Florida.

A softer dollar typically lifts dollar-denominated metals by
making them cheaper for holders of other currencies.

The emergence of improved economic conditions in most major
economies, as indicated by the Organization for Economic Cooperation
and Development's (OECD) composite leading indicator at 100.6 in
September from 99.3 in August, also helped underpin prices.
[ID:nL6415644]

CHINA DATA

The market is also closely watching China's October trade and
output data due later in the week. [ECONCN]

China's October imports of unwrought copper and semi-finished
copper products are expected to fall after a surprisingly strong
inflow in September, hit by poor margins for spot imports and delays
to contracted shipments. [ID:nHKG157207]

Copper has more than doubled in value so far this year on the
back of robust demand from China, the world's top consumer of the
metal used in power and construction.

"Copper's got more upside heading to the end of the year," said
Daniel Smith, an analyst at London's Standard Chartered. "$7,000 is
the next target before the end of the year."

German data also supported. Industrial output in Europe's
largest economy rose much faster than expected in September and
imports posted their biggest increase in over a year.
[ID:nL9394268]

But inventories of copper at LME warehouses have been rising
since mid-July, restraining sentiment. Stocks rose 3,900 tonnes to
389,475 tonnes, their highest since early May.

Aluminum MAL3 ended at $1,952 from $1,910. Stocks of the metal
used in transport and packaging fell 2,475 tonnes to around 4.5
million tonnes, off this year's record highs around 4.6 million
tonnes.

Zinc MZN3 closed at $2,160 from $2,174 and battery material
lead MPB3 at $2,300 from $2,250.

Nickel MNI3 ended at $17,430 from $17,350 and tin MSN3 at
$14,750 a tonne from $14,750 on Friday.
Metal Prices at 1950 GMT
Metal Last Change Pct Move End 2008 Ytd Pct

move
COMEX Cu 296.15 1.60 +0.54 139.50 112.29
LME Alum 1951.00 41.00 +2.15 1535.00 27.10
LME Cu 6560.00 70.00 +1.08 3060.00 114.38
LME Lead 2264.00 14.00 +0.62 999.00 126.63
LME Nickel 17460.00 110.00 +0.63 11700.00 49.23
LME Tin 14750.00 0.00 +0.00 10700.00 37.85
LME Zinc 2175.00 1.00 +0.05 1208.00 80.05
SHFE Alu 15185.00 -20.00 -0.13 11540.00 31.59
SHFE Cu* 51310.00 170.00 +0.33 23840.00 115.23
SHFE Zin 16965.00 80.00 +0.47 10120.00 67.64
** 1st contract month for COMEX copper * 3rd contract month for
SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07
(Additional reporting by Pratima Desai in London; ; Editing by
Marguerita Choy)