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METALS-Copper steadies as oil recovers, but rising supplies weigh
December 17, 2014 / 11:32 AM / 3 years ago

METALS-Copper steadies as oil recovers, but rising supplies weigh

* China copper output rises in Nov from month before

* Fears over Russia currency crisis pause

* Coming up: FOMC releases statement at 1900 GMT (Adds official midday prices/details)

By Maytaal Angel

LONDON, Dec 17 (Reuters) - Copper steadied on Wednesday on oil prices moving up from recent 5-1/2-year lows and a relief rally in global equities, but the metal’s gains were expected to be short-lived given mounting evidence of rising supply.

Global equities stabilised from earlier falls as the oil price rebounded and as fears over a full-blown currency crisis in Russia subsided.

Still copper was vulnerable, with the dollar up versus a currency basket on expectations that the Federal Reserve would signal rate hikes were on track in its policy statement later this session.

A stronger dollar makes dollar-priced meals costlier for European and other non-U.S. investors.

Also a concern for copper was rising supply, with the latest data from China showing copper output rose 3.1 percent in November from the previous month, hitting a record for the fourth straight month.

“We have been a bear in copper for a long time. Demand is not that bad but supply is more important. The record output of Chinese copper in November backs (this view),” said Nic Brown, head of commodities research at Natixis.

Three-month copper on the London Metal Exchange was last bid up 0.08 percent at $6,367 a tonne. Still, copper has now fallen by around $1,000 a tonne since the start of the year, underscoring a mounting supply glut.

LME aluminium was last bid up 0.76 percent at $1,921 a tonne, recovering from a 2-1/2-month low hit earlier of $1,892 a tonne.

Aluminium remains vulnerable to the plunge in the rouble, which could entice Russian producers to lift production of the metal, which is sold in dollars, or it could lead to lower sales in Russia, prompting producers to increase exports.

Russia is the world’s second-biggest aluminium producer.

Zinc last traded flat at $2,140 a tonne, having earlier hit its lowest since June at $2,111, while lead last traded down 1.88 percent at $1,884, having earlier hit its lowest since August 2012 at $1,871 a tonne.

Lead has been weighed down by lower growth in electric bike sales in China and high finished stocks of batteries.

Tin ended down 2.97 percent at $19,450 a tonne, while nickel closed down 2.22 percent at $15,645.

In industry news, Russia’s Norilsk Nickel, the world’s largest nickel and palladium producer, plans to raise a $250-million loan from UniCredit bank.

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Three month LME tin

$1 = 6.1943 Chinese yuan renminbi Additional reporting by James Regan, editing by David Evans

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