November 4, 2019 / 12:13 PM / 4 months ago

METALS-Copper firms on hopes for trade deal, China data

* GRAPHIC-2019 asset returns: (Adds official prices)

By Zandi Shabalala

LONDON, Nov 4 (Reuters) - Copper prices extended gains on Monday, boosted by hopes of a resolution to the protracted trade conflict between the United States and China.

The world's two largest economies said they had made progress in negotiations to end the damaging dispute, while upbeat manufacturing data from top metals consumer China added to the positive mood.

"We have not seen any real setbacks recently in trade talks and there's scope for getting a 'phase one' deal," said Danske Bank analyst Jens Pederson.

"We have also been through another round of manufacturing PMIs that is pointing to a moderate recovery rather than further deterioration."

Benchmark copper on the London Metal Exchange (LME) ended 0.5% higher at $5,877 a tonne, adding to the previous session's 1% gain.

On Monday, the Chinese foreign ministry said the presidents of China and the United States had been in continuous touch through "various means".

CHILE SUPPLY: Antogafasta trimmed its annual production targets by about 10,000 tonnes as national protests in Chile, the world's top producer, hobbled operations.

Several of the world's largest miners, including BHP , Anglo American and Glencore, have operations in Chile, the world's largest copper producer.

ALUMINIUM: LME aluminium gained 1.6% to $1,815 a tonne, touching its highest since Sept. 20. This added to a gain of 1.8% made on Friday.

Support for aluminium has come from smelter outages in top producer China and warnings of plant closures from Rio Tinto , but it is still the second worst performing metal on the LME this year.

ALUMINIUM POSITION: The net speculative short position for LME aluminium is expected to have fallen for a fourth consecutive session on Friday to levels last seen in mid-September, according to Marex Spectron estimates.

CHINA ALUMINIUM OUTPUT: China's September output slipped 1.6% year on year, hit by continuing outages at two smelters. The world's biggest producer now faces a struggle to register annual output growth.

INVENTORIES: Aluminium stocks available to the market in LME registered warehouses fell to 788,475 tonnes, their lowest in more than a month. MALSTX-TOTAL

SPREAD: LME cash aluminium maintained its premium over the three-month contract CMAL0-3 - at just above $4 a tonne - indicating tight nearby supplies. On Friday, the spread flipped to a premium from a discount for the first time since January.

STEEL: The European Union argued for the withdrawal of tariffs imposed by U.S. President Donald Trump on metal imports which set duties in 2018 of 25% on incoming steel and 10% on aluminium.

LME PRICES: LME nickel ended 2.4% higher at $16,380 a tonne, zinc rose 0.8% to $2,539, lead was barely changed at $2,162 and tin was bid down 0.6% to $16,425.

Additional reporting by Mai Nguyen; Editing by David Goodman and Mark Potter

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