May 18, 2018 / 3:46 AM / a year ago

METALS-Aluminium drops for third session on rising stockpiles, nickel up

 (Updates prices)
    By Manolo Serapio Jr
    MANILA, May 18 (Reuters) - London aluminium futures slipped
for a third straight session on Friday as inventories increased,
easing worries over a supply shortage in the aftermath of U.S.
sanctions on major Russian producer Rusal.
    On-warrant aluminium stocks in warehouses certified by the
London Metal Exchange - inventories that are not earmarked for
delivery - surged by 153,075 tonnes or 18 percent on Wednesday,
LME data showed on Thursday. MALSTX-TOTAL
    Three-month aluminium on the London Metal Exchange
was down 0.4 percent at $2,283.50 a tonne at 0703 GMT, not far
above Thursday's two-week low of $2,248.50.
    "Markets are less worried of a prolonged deficit as Rusal
(is) set to boost aluminium exports after the U.S. relaxed its
sanctions against Rusal in late April," Commonwealth Bank of
Australia analyst Vivek Dhar said in a note.
    "LME aluminium cancelled warrants are now on par with levels
before the sanctions were announced, potentially meaning that we
could see some stability at these price levels."
    About two weeks after imposing sanctions on Rusal, the
United States last month gave American customers of Russia's
biggest aluminium producer more time to comply with sanctions,
and said it would consider lifting them if Rusal's major
shareholder, Russian tycoon Oleg Deripaska, ceded control of the
    NICKEL: Nickel outperformed other metals, with the LME price
 rising to a nearly one-month high of $14,830 a tonne. 
    In Shanghai, the most-traded July nickel contract
climbed to an intraday peak of 110,430 yuan per tonne, its
loftiest since June 2015, before settling at 110,240 yuan, up
2.2 percent.
    Nickel is the best performing metal on LME this year,
gaining nearly 16 percent so far, with stocks of the metal at
LME warehouses at the lowest since July 2014. MNI-STOCKS
    NICKEL DEFICIT: The global nickel market deficit widened to
15,700 tonnes in March from a revised deficit of 6,600 tonnes in
the previous month, the International Nickel Study Group said. 

    COPPER: LME copper was little changed at $6,873 a
tonne. In Shanghai, the July copper contract on the Shanghai
Futures Exchange rose 0.4 percent to end at 51,290 yuan
 ($8,053) a tonne.
    SHANGHAI OPTIONS: The latest step in China's push to develop
its commodities derivatives market gets underway on Monday as
the Shanghai Futures Exchange launches a month-long test of a
much-anticipated copper options contract.
    MARKETS: The dollar hit a four-month high against the yen,
buoyed by a rise in U.S. Treasury yields that suggests a more
upbeat outlook for the world's largest economy. Asian stocks
    JINCHUAN: China's Jinchuan Group International Resources
 plans to double its African copper and cobalt
production in the next two to three years.
 BASE METALS PRICES                                    0703 GMT
 Three month LME copper                                    6873
 Most active ShFE copper                                  51290
 Three month LME aluminium                               2283.5
 Most active ShFE aluminium                               14835
 Three month LME zinc                                    3084.5
 Most active ShFE zinc                                    23720
 Three month LME lead                                      2370
 Most active ShFE lead                                    19650
 Three month LME nickel                                   14785
 Most active ShFE nickel                                 110240
 Three month LME tin                                      20605
 Most active ShFE tin                                    144900
 BASE METALS ARBITRAGE                                         
 LME/SHFE COPPER                 LMESHFCUc3               258.2
 LME/SHFE ALUMINIUM              LMESHFALc3             -2063.9
 LME/SHFE ZINC                   LMESHFZNc3              382.82
 LME/SHFE LEAD                   LMESHFPBc3               502.9
 LME/SHFE NICKEL                 LMESHFNIc3            -1427.25
 ($1 = 6.3690 Chinese yuan)

 (Reporting by Manolo Serapio Jr.; Editing by Sherry
Jacob-Phillips and Subhranshu Sahu)
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