METALS-LME copper slips back near 2-wk low as China worries resurface

* Japan quarterly premiums reach record $370-$375/t for April-June

* China domestic copper prices trade at a discount to ShFe

* Coming Up: U.S. consumer confidence at 1500 GMT

(Adds comment, detail, updates prices)

SYDNEY, Feb 25 (Reuters) - London copper on Tuesday eased back towards its lowest level in more than two weeks after economic optimism sparked by some major mergers in the United States started to fizzle, and the focus returned to growth concerns in top user China.

Copper sank on Monday after Chinese news reports stoked fears that banks have stopped extending loans to property-related companies, worsening sentiment already dampened by ample supply and a slow start after the Lunar New Year holiday period.

"From a seasonal perspective, you do tend to see a rise in copper demand post Chinese New Year," said analyst Mark Keenan of Societe Generale in Singapore.

Keenan said bad weather in the United States had clouded its economic picture and the Chinese Lunar New Year had distorted economic signals, making it tough to get a reading on the health of the world's top two economies.

"You've got a mixed picture...Hence the price of copper is stuck in this $200 range until we really get some clarity. Certainly the PMIs will give us some help there," he added.

A reading on the health of China's vast factory sector, the official Purchasing Manager's Index, is due on March 1.

Three-month copper on the London Metal Exchange reversed early gains to slip 0.21 percent to $7,062 a tonne by 0703 GMT, after shedding 1.1 percent in the previous session.

Copper hit its lowest level since Feb. 6 on Monday at $7,033 a tonne, and was down more than 3 percent on the year.

The most-traded May copper contract on the Shanghai Futures Exchange traded down 0.8 percent at 49,520 yuan ($8,100) a tonne. It earlier hit a three-month low.

European stocks were set to dip in early trade on Tuesday, taking a breather after a three-week rally, after stocks on Wall Street sped to historic highs amid more merger buzz.

Radio frequency chipmaker RF Micro Devices Inc agreed to buy peer TriQuint Semiconductor Inc for about $1.6 billion, and Men's Wearhouse Inc raised its offer for Jos. A. Bank Clothiers Inc by more than 10 percent.

China's market is amply supplied with copper. Exchange stockpiles are growing while Chinese domestic physical copper prices have traded at a discount against front month ShFE prices this week, reversing a small premium seen earlier in February.

In other news, Indonesia will ease a controversial tax on mineral concentrate exports for firms that build smelters in the country, in the first rollback of new rules that have caused its mining industry to grind to a halt.

This may kickstart concentrate shipments from one of the region's top producers that have been halted since mid-January and have encouraged smelters to drop processing fees.

A $4 billion copper and gold project in Indonesia, snatched from an Australian company two years ago, is set to come back to the market this year in a public offering by its new owners, led by two local coal tycoons.

In other metals, some big aluminium producers have pushed up their proposed premiums on primary metal to Japanese buyers by 45-47 percent to a record $370-$375 per tonne for April-June shipments, four sources involved in quarterly pricing talks said on Monday.

The lofty levels reflect a global trend, with premiums racing higher in Europe and the United States at the start of the year, as some users were caught short of physical metal given widening output cuts at producers.

Since then, premiums have begun to stabilise as doubts surfaced about the scope for further significant gains ahead of new LME rules, which are intended to reduce prolonged delays in getting access to metal from LME-approved warehouses.


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

($1 = 6.0984 Chinese yuan)

(Reporting by Melanie Burton; Editing by Michael Perry and Sunil Nair)