Wires

METALS-London metals rises as virus outbreak causes supply shortage worries

Mai Nguyen

(Updates prices)

Feb 10 (Reuters) - London base metals advanced on Monday on fears of a supply shortage in China, a major producer of base metals, where a coronavirus outbreak has killed over 900 people and threatened to disrupt the global supply chain.

Three-month copper on the London Metal Exchange (LME) rose 0.8% to $5,709 a tonne by 0623 GMT, nickel jumped 2% to $13,025 a tonne, zinc rose 1.6% to $2,179.50 a tonne, tin advanced 1.8% to $16,470 a tonne, while aluminium edged up 0.2% to $1,729 a tonne.

China's nonferrous metal output will fall at least 10% year-on-year in February, as the country battles the virus outbreak but operations are expected to normalise after the second quarter, the country's metal association said.

"Before the price consolidation, the main concern was demand destruction due to China's economic slowdown and lockdown, but as the situation develops, it seems that supply is also disrupted," said analyst Helen Lau of Argonaut Securities.

"Prices might weaken going forward but not too much," Lau said.

FUNDAMENTALS

* DEATH TOLL: The new coronavirus has killed 908 people and infected 40,171 people in China.

* CHILE COPPER: Chile state miner Codelco and BHP's sprawling Escondida mine saw copper output rise in December 2019, Chilean state copper agency Cochilco said.

* MANTOVERDE: Japan's Mitsubishi Materials Corp has bought a 30% stake in Mantoverde copper mine and an associated copper project from Mantos Copper for $236 million to secure more concentrates for its smelters.

* NORSK HYDRO: Aluminium producer Norsk Hydro reported a lower-than-expected fourth-quarter profit, sapped by dwindling demand and falling metal prices.

* CHINA: China's factory-gate prices snapped six months of year-on-year declines in January, although prolonged business closures from the outbreak mean positive momentum is unlikely to persist.

* TIN: Indonesia's state miner PT Timah plans to increase its 2020 refined tin output by 5% annually, a senior official said.

* SHANGHAI PRICES: The most-traded copper contract on the Shanghai Futures Exchange eased 0.6% to 45,470 yuan ($6,512.83) a tonne, nickel fell 0.4% to 104,670 yuan a tonne and lead declined 0.6% to 14,025 yuan a tonne.

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PRICES

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

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS ($1 = 6.9816 Chinese yuan renminbi) (Reporting by Mai Nguyen; Editing by Amy Caren Daniel)