* Increased supply seen entering copper market this year
* Aluminium stocks in LME warehouses hit record high
* Coming up: U.S. Philly Fed business index at 1500 GMT
LONDON, Jan 16 (Reuters) - Copper prices slipped on Thursday, weighed down by expectations of increased supplies later in the year, but signs of low availability for immediate consumption limited the decline.
Three-month copper on the London Metal Exchange was at $7,318.50 a tonne at 1057 GMT, down from a last bid of $7,350 a tonne. It earlier hit a one-week high at $7,370.
Analysts said more supply of refined metal was expected by the second half, as mine output increases and smelting capacity ramps up, in a move likely to weigh on copper prices this year.
"What we have in the two years ahead is substantial additional amounts of new mine supply coming on stream," said Nic Brown, head of commodities research at Natixis.
"There were a lot of smelter outages last year. But now we should see an increase in smelting capacities due to higher treatment and refining charges that will help to incentivise smelters to increase capacity."
Rio Tinto recorded big increases in production of iron ore and other minerals it sells mainly to China. Refined copper output from its Kennecott Utah Copper unit rose 19 percent in 2013, while mined copper was up 29 percent.
Price falls, however, were capped by concerns about a lack of short-term supply in the physical market due to low stockpiles of copper in LME warehouses and port strikes in the world's No. 1 copper producer, Chile.
Reflecting the concerns, cash copper prices have fetched a premium against three-month prices since December, trading at $28 at the close on Wednesday .
Copper stocks in LME-registered warehouses have been falling steadily since September, and are at around one-year lows.
"The copper market is tight ... we're likely to see the backwardation continue," a Singapore-based trader said.
Analysts said the market was also cautious that the U.S. Federal Reserve could be more aggressive in its stimulus tapering following signs of economic growth in the country.
The U.S. economy continued to grow at a moderate pace from late November through the end of 2013, with some regions expecting a pick-up, the Fed said on Wednesday.
"The main theme is that we'll see a more hawkish stance from the Fed moving forward. In line with that we'll continue to see a strong dollar, which will place downward pressure on commodities prices - including metals," said analyst Tim Radford of Sydney-based adviser Rivkin.
In other metals, aluminium inventories in LME-registered warehouses climbed to a record of nearly 5.5 million tonnes, more evidence of a market weighed down by oversupply.
Aluminium traded at $1,790.50 a tonne, up from a close of $1,784 on Wednesday.
The price of the metal used in transport and packaging fell 13.2 percent last year and has extended its losses by nearly 1 percent so far in January.
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