re: nickel at $11045..eat this.. ODJ LME Metals In Asia: Up On...

re: nickel at $11045..eat this..
ODJ LME Metals In Asia: Up On Chinese Buying, Short Covering

Singapore, Oct. 13 (OsterDowJones) - Prices on the London Metal Exchange
surged Monday in Asia, with Chinese buying seen in every metal, said traders.
"The Chinese came and bought everything today," said a Hong Kong-based
trader.
"They basically traded everything today: lead, tin, zinc, aluminum,
copper," he said.
The buying was particularly heavy on copper, with the Chinese players
buying both on the LME and the Shanghai Futures Exchange, he said.
Copper futures on the SHFE rose sharply Monday, on talk that one of the big
players had been caught short, a Singapore-based trader said.
At 0726 GMT, all copper futures on the SHFE were up 520-570 yuan a metric
ton ($1=CNY8.28), with the most heavily traded February 2004 contract up
CNY560/ton at CNY19,440/ton from Friday's close.
"The buying's got nothing to do with Freeport," said the Hong Kong-based
trader, referring to some reports that PT Freeport Indonesia, operator of the
world's biggest gold-copper Grasberg mine, would close it for two weeks due to
an accident.
A company spokesman said only parts of the open pit mine affected by a
slippage of material are closed.
LME three-month copper's breach of key resistance of $1,900/ton also
triggered some stop-loss orders from the short-position holders, said traders.
At 0757 GMT, three-month copper was quoted at $1,912.50/ton, from
$1,883/ton in late London kerb Friday.
It earlier reached an intraday high of $1,916/ton.
This is the first time the contract has breached $1,900/ton since December
2000.

0757 GMT Kerb 0757 GMT Kerb -a
Copper 1912.5 (1883.0) Lead 565.5 (564.0)
Aluminum 1495.0 (1481.0) Nickel 11045.0(10900.0)
Tin 5270.0 (5250.0) Zinc 907.5 (902.0)
Comex -b Dec 03 copper 87.40 (86.35)
Tocom -c Mar 04 aluminum N/A (167.7)

a. LME three-month prices in dollars a metric ton at 0757 GMT, with
Friday's late kerb close in parentheses.
b. Comex's after-hours copper in cents a pound at 0757 GMT, with Friday's
close in parentheses.
c. Tokyo Commodity Exchange aluminum futures not available Monday, a
public holiday. Friday's close, in yen a kilogram, in parentheses.


With the copper market players so panicky, the metal could easily scale its
next resistance of $1,925/ton, then $1,950/ton, said a Sydney-based trader.
The Chinese buying spree could have been a reaction to the cancellation or
lowering of export rebates, said the Hong Kong-based trader.
He was referring to the Chinese government's consideration of cutting
rebates from export taxes.
Market talk has it that the government could remove all of the rebates for
some metal exports, while an official announcement could come as soon as
Wednesday.
Once the rebates are lowered or cancelled, it will cut Chinese exporters'
competitiveness, reducing their exports and improving the international
outlook of metals such as aluminum, tin, lead and zinc, of which the country
is a substantial exporter.
However, the fact that aluminum, lead and zinc have managed to rise despite
selling by the Chinese exporters last week could have led the Chinese to buy
Monday instead, particularly those who need to buy back to cut losses, said
the Singapore-based trader.
Three-month aluminum was also higher, at $1,495/ton, the highest since June
2001.
Three-month nickel surged to forge a new high of $11,120/ton, a level last
seen in September 1989.

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Wong Chia Peck, OsterDowJones; 65-6415-4082; [email protected]
Copyright 2003 OsterDowJones Commodity News (ODJ). All rights reserved.