METALS-Copper rises as stock build-up halts, Chile miners to strike

* LME/ShFE arb: http://tmsnrt.rs/2oQ5nm2 (Updates prices)

LONDON, July 11 (Reuters) - Copper rose on Tuesday as a rapid build-up of inventories that has pushed prices lower since late June halted and workers voted to strike at a mine in Chile, raising supply concerns.

Stainless steel ingredient nickel also gained after Chinese steel prices reached 3-1/2 year highs, while zinc, used to galvanize steel, rose to its highest since March.

"Copper demand is still buoyant. The market over-reacted to increases in inventory," said ABN AMRO analyst Casper Burgering, adding car sales, construction and manufacturing output in China remained solid.

However, Capital Economics analyst Caroline Bain said growth in China and the United States was likely to slow while interest rate rises would strengthen the U.S. dollar, making metals more expensive for holders of other currencies.

"Our forecasts suggest that most prices will fall from here," she told the Reuters global base metals forum.

COPPER: London Metal Exchange benchmark copper was up 0.4 percent at $5,845.50 a tonne at 1435 GMT after earlier rising to $5,863.

COPPER STOCKS: Prices had slipped nearly 3 percent since late June as stocks in LME-registered warehouses rose by a third, signaling plentiful supply. Stocks fell 225 tonnes on Tuesday to 319,750 tonnes. <MCUSTX-TOTAL>

COPPER STRIKE: Workers at Chile's Zaldivar copper mine voted to approve a strike after talks with the firm failed. The nearby Centinela mine is also in negotiations over strike action. Together the two mines produced 340,000 tonnes of copper in 2016.

FREEPORT: Indonesia says it will invite the head of mining giant Freeport McMoRan Inc to Jakarta this month to try to settle a festering dispute over a new deal to operate the world's second-largest copper mine.

CHINA CAR SALES: Vehicle sales rebounded in June, shaking off weakness in the previous two months.

NICKEL: Higher steel prices helped push benchmark LME nickel 1.4 percent higher to $9,130 a tonne.

ZINC: Zinc was up 1.3 percent at $2,816.50 after touching $2,819, the highest since March 31. The metal has risen more than 15 percent since early June as dwindling stocks led to supply fears.

ZINC SPECULATORS: The net long position in zinc was 26 percent of open interest as of Thursday, the largest speculative long of any base metal and close to the highest since November, brokers Marex Spectron said in a note.

U.S. FED: Federal Reserve Chair Janet Yellen will address congress on Wednesday and Thursday, giving clues about the pace of U.S. monetary tightening.

PRICES: LME aluminum was up 0.1 percent at $1,899.50 a tonne, tin was 0.3 percent higher at $19,940 and lead was up 0.4 percent at $2,330.

(Additional reporting by James Regan; Editing by Edmund Blair and Mark Potter)