LONDON, July 19 (Reuters) – Copper prices plunged to one-year lows on Thursday as fund selling accelerated due to worries about demand from the trade tussle between the United States and top consumer China.

Benchmark copper on the London Metal Exchange ended down 1.4 percent at $6,065 a tonne after hitting $5,988 earlier in the session, its lowest since July 2017 and a drop of nearly 20 percent since June 7.

“It’s all framed in your macro view and what you think is going to happen with trade in the fourth quarter,” said Oliver Nugent, commodities strategist at ING bank.

“This isn’t just long liquidation, there are a lot of shorts actively chasing metals on the way down.”

TRADE: The United States and China this month slapped tariffs on $34 billion of each other’s imports in an escalating trade tussle that has roiled financial markets.

STOPS: Traders said the break below $6,090 saw funds cut bets on higher prices and that momentum picked up as many also took bets on lower prices. “Liquidity disappeared, most market participants watched from the sidelines,” one copper trader said.

PAPER: “The negative sentiment isn’t just confined to paper markets, consumers are not interested in stockpiling at these low prices,” Nugent said.

COSTS: Copper prices are now below the marginal costs of production — the highest costs of production — estimated to be between $6,200-$6,400 by some analysts.

SUPPLY: Analysts say copper could trade below marginal costs of production for some time, but not for long as the longer term picture is one of deficits.

“The recent sell-off is providing a long-term buying opportunity,” Citi analysts said in a note, adding that if “the trade war materialises to the extent possible” copper will trade “materially lower before it goes higher again”.

“Our base case is that we do not expect a sustained downward spiral in global growth as a result of the trade war.”

PHYSICAL: Nugent said lower prices have already seen a tighter copper scrap market in the United States.

CHINA: Nervousness about demand in China, which accounts for around half of global industrial metals consumption, also pushed prices of aluminium to $2,001, its lowest since April 6, and lead to a 13-month low at $2,095.

DOLLAR: Also weighing on the complex was the higher U.S. currency, which makes dollar-denominated commodities more expensive for non-U.S. firms.

PRICES: Aluminium traded down 1.3 percent to $2,001, zinc slid 2.1 percent to $2,545.5, lead fell 2.4 percent to $2,117, tin gained 0.1 percent to $19,500 and nickel ceded 2.1 percent to $13,330.