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METALS-Rising supplies, weak demand push nickel to 11-month low

* LME nickel stocks account for nearly 20 pct of global demand

Cash tin over the 3-month commands a high premium

* LME/ShFE arb: http://tmsnrt.rs/2oQ5nm2 (Recasts, adds comment, changes dateline from Sydney)

By Pratima Desai

LONDON, May 31 (Reuters) - Nickel prices tumbled to 11-month lows on Wednesday on investor concern over rising supply from top producers Indonesia and the Philippines as well as weak demand from stainless steel mills in China.

Benchmark nickel on the London Metal Exchange was down 2.6 percent at $8,880 a tonne at 0939 GMT from an earlier $8,835, its lowest since late June last year.

"People are looking at the potential for higher supplies from Indonesia and the Philippines and getting very bearish," said Societe Generale analyst Robin Bhar. "Demand from the stainless sector is particularly weak."

PHILIPPINES: Earlier this month President Rodrigo Duterte appointed a former military man as the new environment minister after Congress dismissed his first choice, who had ordered the closure of more than half of the mines in the world's top nickel ore supplier.

INDONESIA: Indonesia earlier this year relaxed a ban on exporting unprocessed nickel ore, which had been in place since the start of 2014.

STAINLESS: About two-thirds of global nickel supply is used to make stainless steel, most of which is produced in China.

NICKEL COSTS: "I think the downside is pretty limited, prices are below the marginal cost or the 90th percentile, which adjusted for currency and other things is around $10,300/$10,400," Bhar said.

NICKEL PRICES: "Nickel prices will remain trading at very low levels through 2017 and much of 2018, until a substantial supply response both in China and outside of China eradicates our forecast surplus of 37,000 tonnes in 2017 and about 100,000 in 2018," Goldman Sachs analysts said in a note.

NICKEL STOCKS: High inventories are also a negative for prices, traders say. Stocks at more than 378,000 tonnes account for almost 20 percent of global consumption estimated at nearly two million tonnes this year. WARRANT HOLDINGS: Traders are watching large holdings of cash contracts and warrants of aluminum and nickel. <0#LME-WHC> TIGHT TIN: Large holdings of tin warrants and cash contracts and low LME stocks -- below 2,000 tonnes and the lowest since 1989 -- have fueled concern about a tight LME market.

TIN PREMIUM: Tighter supply on the LME has seen the cash contract over the three-month command a premium of more than $100 a tonne since mid-May <MSN0-3>. Benchmark tin was down 0.7 percent at $20,300 a tonne.

CHINA: China's manufacturing sector expanded at a solid pace in May thanks to robust construction and infrastructure investment, but worries about a slowdown over coming months weighed on industrial metals generally.

PRICES: Copper slipped 0.4 percent to $5,635 a tonne, aluminum fell 0.7 percent to $1,912, zinc lost 2.1 percent to $2,569 and lead ceded 1.2 percent to $2,079.

(Reporting by Pratima Desai; Editing by David Evans)