November 22, 2019 / 5:03 AM / 18 days ago

METALS-LME copper set for second weekly drop on U.S.-China trade angst

(Adds comments, details and updates prices)

MANILA, Nov 22 (Reuters) - Benchmark London copper prices slipped on Friday, set for a second straight weekly decline, on conflicting signals over an interim trade deal between the world’s two biggest economies.

Three-month copper on the London Metal Exchange was down 0.2% at $5,820.50 a tonne, as of 0416 GMT.

The most-traded copper contract on the Shanghai Futures Exchange was down 0.5% at 46,880 yuan ($6,667.43) a tonne by the midday break.

Worries over a “phase one” trade deal, though, were tempered after China said it was willing to work with the United States to resolve core trade concerns, trying to allay fears that talks might be unravelling.

A report in the Wall Street Journal meanwhile cited that China has invited top U.S. trade negotiators for a new round of face-to-face talks in Beijing.

While supply issues supported prices as the copper market is in deficit this year and probably also in 2020, demand prospects remained clouded amid global economic slowdown.

Data on October industrial profits in China, the world’s top copper consumer, should signal that its economy has been reeling under the trade spat with the United States, said ING economist Prakash Sakpal.

Data on China’s industrial profits is due next week.

“The latest news hasn’t been very good. First, the postponement of the deal signing to December, and now probably to 2020,” Sakpal said, adding that just about a month ago, things on the trade front were moving in the desired direction with both sides nearing a “phase one” deal.

FUNDAMENTALS: The global world refined copper market was in a 330,000 tonnes deficit for the first eight months of the year, compared with a 268,000 tonnes deficit in the same period a year earlier, according to the International Copper Study Group.

TREATMENT CHARGES: Miner Freeport-McMoRan Inc and three Chinese copper smelters agreed a 23% cut in annual treatment and refining charges (TC/RCs) for 2020, pushing the industry benchmark to a nine-year low.

GLOBAL GROWTH: The global economy is growing at the slowest pace since the financial crisis as governments leave it to central banks to revive investment, the OECD said in an update of its forecasts.

RARE EARTHS: China will accelerate the launch of futures contracts for rare earths, used in devices such as mobile telephones and batteries, an official of the Shanghai Futures Exchange said on Friday.

COPPER: Rio Tinto faces renegotiating the terms of an agreement underpinning its Mongolian copper mine project, after lawmakers on Thursday approved plans to revise the deal to make it more beneficial for Mongolia.

NICKEL: The global nickel market deficit widened to 3,200 tonnes in September from a revised shortfall of 300 tonnes the previous month, the International Nickel Study Group said.

OTHER PRICES: LME Nickel was virtually trading flat, while ShFE nickel was up 0.1%, LME tin gained 0.4%. ShFE tin rallied 1.9%, LME aluminium advanced 0.5%, while ShFE aluminium was almost steady.

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

$1 = 7.0312 yuan Reporting by Enrico dela Cruz; Editing by Subhranshu Sahu and Sherry Jacob-Phillips

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