October 9, 2018 / 1:41 AM / 10 days ago

METALS-London aluminium near one-week low as supply woes abate

MANILA, Oct 9 (Reuters) - London aluminium dropped in early Asian deals on Tuesday to trade near one-week lows hit in the previous session, as worries over supply of raw material alumina eased after a Brazilian court approved measures that could allow the world’s biggest alumina refinery to resume production.

Norsk Hydro said on Saturday that it had been granted a permit in Brazil to use new technology to extend the life of a disposal area for its troubled Alunorte alumina refinery which should lead to the restart of operations at 50 percent.

That came days after Hydro said it would halt production and lay off 4,700 people at Alunorte, which has been operating at half capacity since March due to an environmental dispute.

Three-month aluminium on the London Metal Exchange was down 0.3 percent at $2,061 a tonne by 0122 GMT, not far above Monday’s one-week trough of $2,044.50.

The metal has fallen 9 percent since touching a 3-1/2-month peak of $2,267 on Thursday.

The most-traded November aluminium on the Shanghai Futures Exchange rose 1.2 percent to 14,550 yuan ($2,100) a tonne.

* CHINA TAX REBATES: China will increase export tax rebates from Nov. 1 and quicken export tax rebate payments to support foreign trade, as a trade war with the United States escalates.

* VALE COPPER EXPANSION: Vale is close to approving a $1 billion expansion of its Salobo copper mine, two people familiar with the matter said, as the world’s top iron ore miner seeks to diversify and take advantage of growing international demand for the metal.

* CODELCO SALES: Codelco is in talks to sell up to 60,000 tonnes of copper a year to China Minmetals from 2019 to 2021, marking a change in the sales strategy at Chile’s state-owned miner which typically made deals on an annual basis, industry sources said.

* CHILE: Chile aims to find new copper markets and expand its lithium industry as it seeks to shield its economy from a U.S-.China trade war, the mining minister of the world’s biggest copper producer said.

* OTHER METALS: LME copper added 0.2 percent to $6,190.50 a tonne and zinc gained 0.2 percent to $2,620. In Shanghai, zinc jumped as much as 2.8 percent to 22,570 yuan per tonne, its strongest since June 28, and copper rose 0.4 percent to 50,240 yuan.

* MARKETS: Asian shares hit 17-month lows as investors fretted about everything from the Chinese economy, to trade wars, higher U.S. bond yields and political dysfunction in Europe. The dollar slipped against the safe-haven yen in Asia.

DATA AHEAD (GMT)

0600 Germany Trade data Aug

1000 U.S. NFIB business optimism Sep

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

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS ($1 = 6.9289 Chinese yuan)

Reporting by Manolo Serapio Jr.; Editing by Subhranshu Sahu

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