REFILE-METALS-Copper prices head for weekly gain on US-China tariff truce

By Hongmei Li

SINGAPORE, May 16 (Reuters) - Copper prices edged lower on Friday but were set for a weekly rise on China-U.S. temporary trade truce, although uncertainty over longer-term demand prospects for the metal capped further gains.

Benchmark copper CMCU3 on the London Metal Exchange (LME) was down 0.4% at $9,536 a metric ton, as of 0707 GMT. The most-traded copper contract SCFcv1 on the Shanghai Futures Exchange (SHFE) eased 0.3% to 78,140 yuan ($10,851.12) per ton.

For the week, LME copper is up about 1.1%, while prices in Shanghai have risen around 0.6%.

"Chinese traders are happy about the 90-day pause, but the market has remained uncertain about what is going to happen after the 90 days," a Shanghai-based metals analyst said.

"The fact that China's exporters have been rushing cargoes out is a tell-tale sign."

The initial optimism about the 90-day pause agreed by Beijing and Washington on most of their retaliatory tariffs has faded. The market is now focusing on the potential new tariffs on copper imports that the U.S. has been considering since February.

Chinese analysts expect the SHFE copper price to hover around 78,000–79,000 yuan per ton in the near term, reflecting mixed market sentiment.

Copper stocks in the SHFE-monitored warehouses surged 34% on week to 108,142 tons.

"It is not surprising to see the copper stocks up, just that the pace may be a bit too fast, which may add pressure on copper prices in the near term," the Shanghai-based analyst said.

Among other London metals, aluminium CMAL3 slipped 0.8% to $2,468.5 per ton, zinc CMZN3 fell 1.1% to $2,694.5, lead CMPB3 lost 1.1% to $1,983 and tin CMSN3 edged down 0.5% to $32,800.

SHFE aluminium SAFcv1 fell 0.5% to 20,130 yuan a ton, zinc SZNcv1 dropped 1.1% to 22,500 yuan and lead SPBcv1 slipped 0.8% to 16,870 yuan.

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($1 = 7.2011 Chinese yuan renminbi)