UPDATE 5-Copper steadies as supply concerns offset dollar

(Recasts, adds comment, detail, closing prices)

By Humeyra Pamuk and Pratima Desai

LONDON, April 25 (Reuters) - Copper prices steadied on
Friday, supported by worries about supplies from Chile after the
metal hit a three-week low on a bout of profit-taking.

Copper MCU3 for three-months delivery on the London Metal
Exchange fell to $8,370 per tonne, its lowest since April 2.

The industrial metal used widely in the power and
construction industries closed at $8,575 a tonne, down from
$8,525 a tonne at the close on Thursday, depressed by a rise in
the dollar.

"The overall commodities sell-off was on the stronger
dollar," said Daniel Smith, analyst at Standard Chartered.

Analysts said base markets would be watching the dollar, in
which many metals are priced. A stronger dollar makes
commodities priced in the U.S currency more expensive for
holders of other currencies.

The dollar was heading for its best monthly performance in
2-1/2 years against a basket of major currencies on Friday,
boosted by a growing view that the U.S. Federal Reserve may stop
cutting interest rates. [ID:nN25369604]

Smith added that a worker's strike at Chile's Codelco would
help underpin prices. "It's difficult to see what's going to
happen there, but copper could spike higher."

A strike at the world's top copper producer, Codelco, has
paralysed production in several divisions of the company,
including the world's biggest underground copper mine.

As the strike entered its ninth day, state-owned Codelco,
with annual output of about 1.7 million tonnes, said its
Teniente mine would remain closed until at least Friday
afternoon. Two other Codelco divisions have been closed for nine
days due to the strike. [ID:nN24195882]

TIGHT CREDIT

Some dealers said the strike in Chile was already priced
into the market.

"There are a lot of strikes in Chile and they tend to be
brief and little if any output is lost," said John Kemp,
economist at Sempra Metals.

Lack of buying by Chinese consumers would weigh on copper
prices which last week touched a record high of $8,880 a tonne.

"A lot of copper consumers, because they are quite small
companies have been quite badly hit by tighter credit
conditions," Smith said. "With the very high copper prices we
are seeing now, they are having quite a hard time of it."

Aluminium MAL3 ended at $2,995 a tonne versus $3,000 on
Thursday. Dealers said funds were liquidating positions in
aluminium, which unlike copper, has failed to make new highs
since May 2006.

Tin MSN3 was untraded at the close, but bid at $23,850
from $23,700. Concerns over supplies from top producers China
and Indonesia have helped lift prices by about 50 percent this
year to a record $24,600 on Thursday.

Lead MPB3 was up a touch at $2,770 from $2,759, zinc
MZN3 gained to $2,320 from $2,240 and nickel MNI3 firmed to
$29,500 from $28,905 at the close on Thursday.

Metal Prices at 1612 GMT
Metal Last Change Pct Move End 2007 Ytd Pct

move
LME Cu 8580.00 55.00 +0.65 6670.00 28.64
SHFE Cu* 64910.00 -570.00 -0.87 56880.00 14.12
LME Alum 2990.00 -10.00 -0.33 2403.00 24.43
SHFE Alu* 19000.00 -160.00 -0.84 18180.00 4.51
COMEX Cu** 395.00 5.50 +1.41 303.50 30.15
LME Zinc 2315.00 75.00 +3.35 2370.00 -2.32
SHFE Zinc* 18240.00 -150.00 -0.82 18950.00 -3.75
LME Nick 29300.00 395.00 +1.37 26350.00 11.20
LME Lead 2769.00 10.00 +0.36 2550.00 8.59
LME Tin 23850.00 150.00 +0.63 16400.00 45.43
** 1st contract month for COMEX copper
* 3rd contact month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07

(Editing by Chris Johnson)