* Premium for cash over three-month zinc ticks up
* China to prioritise logistics for medical needs (Adds official prices)
LONDON, Jan 31 (Reuters) - Copper steadied near a five-month low on Friday as traders and funds squared bets on lower prices, but sentiment was dominated by worries about demand in top consumer China where the coronavirus has hit economic activity.
Benchmark copper on the London Metal Exchange traded little changed at $5,587 a tonne in official rings, on course for its largest monthly fall since November 2015.
The price of the metal used by investors as a bellwether of economic health hit $5,565 on Thursday, the lowest since early September and a drop of 12% since Jan. 16.
"It is an extreme event, nobody can tell what the final impact will be. Industrial metals such as copper in the short term will stay under pressure," said Wenyu Yao, senior commodities strategist at ING Bank.
Yao said expectations that manufacturing activity would soon start ramping up could be disappointed as factory owners would wait for clarity on the virus before restarting operations after the Lunar New Year holiday.
"Logistics, transportation will prioritise medical needs, transporting metal or fabricated goods are not a priority."
VIRUS: A coronavirus outbreak that began in Wuhan, in China's central province of Hubei, has spread to more than 9,800 people globally, surpassing the total from the 2002-2003 SARS epidemic. The new virus has killed 213 people.
PMIS: Growth in China's factory activity faltered in January, an official survey showed, as export orders fell.
The PMI showed activity holding up in some manufacturing sectors, but economists doubt the survey provides a meaningful read on the economy given developments with the coronavirus and distortions from the holiday break.
ZINC: The premium for the cash over the three-month zinc contract <CMZN0-3> has ticked up to $16 a tonne due to worries about supplies on the LME market, where stocks <MZN-STOCKS> have fallen below 50,000 tonnes to a 20-year low.
One company holding large amounts of zinc warrants <0#LME-WHL> has also contributed to concerns.
Three-month zinc was up 0.5% at $2,199 a tonne.
TIN: A large holding of tin warrants and low stocks <MSN-STOCKS> on the LME market have also pushed up the premium for the cash over the three-month tin contract <CMSN0-3> to a one-month high at $10 a tonne.
Three-month tin rose 0.9% at $16,175.
Traders said much of the tin outflows from LME approved warehouses was heading for China. This can be seen in tin stocks monitored by the Shanghai Futures Exchange <SSN-TOTAL-W> at nearly 7,000 tonnes from below 3,000 tonnes in late November.
OTHER METALS: Aluminium fell 0.4% to $1,724.7, nickel gained 1.1% to $12,760 and lead added 1.4% to $1,851 a tonne. (Reporting by Pratima Desai Editing by David Holmes)