LONDON, Jan 22 (Reuters) – Aluminium prices rose on Tuesday while zinc matched last week’s one-month high as investors brushed off a strong dollar and weaker economic growth in China to focus on that country’s slowing production of the two metals. Trading volumes were thin ahead of the Lunar New Year holiday, which will see China shut down for a week. “We’re heading into softer seasonal flows (but) nearly 3 million tonnes of (Chinese aluminium) smelting capacity has closed and inventories are drawing on a counter-seasonal basis. For zinc, Chinese production remains very weak,” said Deutsche Bank metals strategist Nick Snowdon. He added, however, that the broad metals story is one of price stagnation, largely because of the standoff between poor macroeconomic data and upside policy risk such as further stimulus in China. China’s economy cooled in the fourth quarter, hit by faltering domestic demand and bruising U.S. tariffs, dragging annual growth to its lowest level in nearly three decades in 2018 and pressuring Beijing to roll out more stimulus. * ALUMINIUM, ZINC: Three-month aluminium on the London Metal Exchange traded 0.9 percent up in official midday rings at $1,868 a tonne, the strongest gainer in an otherwise lacklustre LME metals complex. Zinc traded flat at $2,587, having matched last week’s one-month high of $2,595.
* CHINA ALUMINIUM: “The question is how long China can maintain (its) recent record-high production rate, given Chinese smelters are currently chalking up average losses equating to $145 per tonne,” Commerzbank said in a note, citing data from Shanghai Metals Market.
* COPPER: Bellwether copper traded down 0.3 percent in rings at $5,961 as the dollar held near a three-week high and global equities slumped after the International Monetary Fund on Monday warned of a darkening growth outlook.
* METALS FRAUD: Broker ED&F Man has filed a $284 million lawsuit against two Hong Kong companies, accusing them of having knowingly provided fraudulent warehouse receipts for nickel stored in Asia.
* U.S.-CHINA: The United States will proceed with the formal extradition from Canada of Huawei executive Meng Wanzhou in a move certain to ratchet up tensions with China.
* BHP: Global miner BHP Group raised its 2019 copper production forecast to between 1.6 million and 1.7 million tonnes.
* WAREHOUSING: Years after sweeping reform aimed at eliminating logjams in warehouses that collect rent for storing metal, one firm is preventing companies from getting material when they need it from a Malaysian port.
