News: METALS-Lead hits 16-month high on tighter supply, nickel retreats

• Tin at 20-month high on falling inventories
• Shanghai lead at strongest since March 2013
• Coming up: U.S. pending home sales at 1400 GMT

(Updates throughout, changes dateline from MANILA)

Lead climbed to its highest since May last year on Thursday, supported by steadier copper prices and worries over mine supply contraction, while nickel retreated from a seven-week high as inventories remain ample.

Three-month lead on the London Metal Exchange CMPB3 rose 0.9 percent to $2,015 a tonne by 1024 GMT. The metal hit $2,023 earlier, its strongest since May 2015, extending gains seen in the previous session, when rising oil prices also lent support.

Global mine shutdowns over the past year and moves by lead producers to curb output amid low prices have tightened global supplies of the metal, which is used to make batteries.

"Lead, which had underperformed the other base metals for much of this year, has been catching up in last couple of months ... with contraction in lead mine supply and refined lead," said Capital Economics senior commodities economist Caroline Bain.

On the Shanghai Futures Exchange, the most-traded lead contract for November delivery SPBcv1 closed up 2.2 percent at 15,005 yuan ($2,250) a tonne, after rising as much as 3 percent to the highest since March 2013.

China's imports of lead ore and concentrate dropped 10 percent in the first eight months of the year.

The metal was supported by steadier copper CMCU3, which rose 0.3 percent to $4,834 a tonne. More widely traded copper is usually seen as a benchmark for the other metals.

A power outage in South Australia state has halted 300,000 tonnes of annual copper production capacity from BHP Billiton's (BHP) Olympic Dam and Oz Minerals (OZL) Prominent Hill mines.

Elsewhere, three-month tin CMSN3 rose 0.6 percent to a new 20-month peak of $19,970 a tonne. The metal has seen inventories on the LME fall by over 50 percent over the last four months.

Nickel CMNI3 bucked the uptrend seen across the complex, retreating from Tuesday's seven-week top of $10,900, when the Philippines, the world's biggest nickel ore supplier, said it may suspend 20 more mines for environmental infractions.

The Philippines, which accounts for nearly a quarter of the world's nickel mined supply, has already halted 10 mines, eight of them nickel producers.

Prices were down 1 percent at $10,585 a tonne. "For nickel, obviously the market is tightening and obviously these closures will mean that in six to nine months down the road refineries could be struggling to find ore but the bigger picture remains one of really quite high stocks, so physical tightness is the market is still some time off," Capital Economics Bain said.

Shanghai nickel SNIcv1 ended 0.3 percent lower at 81,860 yuan a tonne after earlier touching a seven-week high of 83,610 yuan.

Macquarie said in a note that disruption from the Philippines to the global market may be capped at between 15,000 to 20,000 tonnes of nickel ore given the upcoming monsoon season which limits mining and shipments there. It sees global nickel supply at 1.9 million tonnes this year.

PRICES

	Three month LME copper		  CMCU3  
	Most active ShFE copper		 SCFcv1  
	Three month LME aluminium	   CMAL3  
	Most active ShFE aluminium	  SAFcv1  
	Three month LME zinc			CMZN3  
	Most active ShFE zinc		   SZNcv1  
	Three month LME lead			CMPB3  
	Most active ShFE lead		   SPBcv1  
	Three month LME nickel		  CMNI3 
	Most active ShFE nickel		 SNIcv1   
	Three month LME tin			 CMSN3  
	Most active ShFE tin			SSNcv1	  
	 
($1 = 6.6705 Chinese yuan)