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METALS -Nickel, tin up on Indonesia ban, copper down on Fed fears

Harpreet Bhal and Eric Onstad
Thursday, 5 Dec 2013 | 10:45 AM ET

* Tin prices climb to 5-week high on Indonesian export ban

* ShFE plans to launch nickel, tin contracts next year

LONDON, Dec 5 (Reuters) - Nickel and tin rose on Thursday after Indonesia reiterated it would impose an export ban on ore, while copper dipped following strong U.S. economic data on worries the Federal Reserve could curtail monetary stimulus.

Three-month tin on the London Metal Exchange gained 1.7 percent to $23,100 a tonne by 1507 GMT after touching the highest level since Oct. 30.

LME nickel climbed 1.5 percent to $13,849 a tonne, the strongest in 3-1/2 weeks.

The gains followed news that Indonesian lawmakers had rejected a government bid to water down a planned ban on shipments of unprocessed metals, dashing Jakarta's attempts to keep much-needed export revenue flowing in.

"It's a short-term reaction to the Indonesian news," said analyst Andrey Kryuchenkov at VTB Capital in London, adding that he did not expect nickel's gains to last.

"Nickel is plentiful, so I don't think it will have a very long-term impact, but for the time being the market is trading on sentiment."

Commerzbank analysts were also sceptical that a strict ban would be imposed: "There are likely to be exemptions to the regulations, however, given that only 28 smelting plants are under construction so far, meaning that the country would be denying itself an important source of revenue."

In industry news, the Shanghai Futures Exchange aims to launch nickel and tin futures contracts to broaden the range of non-ferrous metals covered, an exchange official said.

Copper shed 0.4 percent to $7,067.75 after reaching a nine-day high in the previous session.

The metal used in power and construction is down more than 10 percent in the year to date. It broke below $7,000 a tonne in mid-November after holding in a $7,000-$7,400 range since August.

Third-quarter U.S. growth was revised to 3.6 percent from 2.8 percent, while weekly jobless claims also fell.

The U.S. data boosted speculation that Friday's non-farm payrolls figures could also beat expectations and accelerate the Fed's stimulus withdrawal plans.

The stimulus programme has released more money into the economy and has been used to buy assets including commodities.

"I will say that it could an easy decision for the Fed if we see the final number (for non-farm payrolls) above 200,000 for the second month in a row," said Naeem Aslam, chief market analyst at Ava Trade.

"On the flip side, if the number is around 125,000, then we may not see any announcement by the Fed on their tapering decision."

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

Three month LME tin