Fri, May 30 2008, 12:52 GMT
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LONDON (Reuters) - Copper and aluminium prices edged up on Friday as worries about supply shortfalls resurfaced, while tin fell sharply to a two-month low.
Copper <MCU3> for three-month delivery on the London Metal Exchange was at $7,965 per tonne in the open outcry trade, up $75 from its close of $7,890 on Thursday, when touched it $7,855 per tonne, its lowest level in two months.
"Copper's fundamentals this year are very supportive -- this is a market in deficit. We would expect to see any further drop from these levels as being short-lived," said Gayle Berry, metals analyst at Barclays Capital.
"I would expect aluminium to remain really quite well supported ... Smelters in China do face further power hikes that will further raise their costs of production."
Aluminium <MAL3> was up at $2,923 per tonne from $2,880 the previous day. The metal has been boosted this year by worries about power problems and supplies of the energy-intensive metal from China, the world's biggest producer and consumer.
Tin <MSN3> fell to $19,925 a tonne, the lowest since April 3. It was last at $20,600 from $21,000. Prices of the metal have fallen by 18 percent since hitting a record of $25,500 on May 15.
"We're seeing a sharp profit-taking after a good rally," an LME trader said, adding the moves in the tin market could be volatile as it was more illiquid than copper or aluminium.
Analysts said the firmer dollar would weigh on commodity prices, as it made dollar-denominated metals more expensive for holders of other currencies.
The dollar firmed against the euro after surprisingly weak German retail sales figures added to the view that the euro zone economy may be weakening. [ID:nL30616593]
Metals prices slipped on Thursday after LME-registered warehouse figures showed most stocks had risen.
However copper could see some support by the threat of a nationwide strike in Peru and industrial action in Mexico, where workers held a one-day strike earlier this week. [nN29373599]
Subcontract workers at the world's largest copper miner, Codelco, are unhappy with a recent court ruling that overturned part of an agreement that ended a long-running dispute.
LME lead <MPB3> fell $1 to $1,951 after shedding nearly 4 percent on Thursday.
Teck Cominco <TCKb.TO> said it had restarted its Trail lead refinery in British Columbia after a brief closure following a pollution spill. [nSP210724]
Zinc gained $11 $1,991 while nickel was up $45 at $22,250/22,450.
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