Nov 19 (Reuters) - Aluminium prices surged on Friday amid supply disruption worries after a smelter in China had stopped production following an explosion.

An aluminium plant in China's Yunnan province with annual capacity of 300,000 tonnes has stopped production after an explosion on Thursday evening, Shanghai Metals Market reported https://news.smm.cn/live/detail/101669624.

A person answering the phone at Yunnan's Wenshan city emergency management bureau confirmed to Reuters that an explosion took place at an aluminium factory on Thursday night and was under investigation, without naming the company nor providing any other details.

The most-traded January aluminium contract on the Shanghai Futures Exchange rose as much as 3.9% to 19,310 yuan ($3,026.27) a tonne, before easing to close at 19,205 yuan a tonne, still up 3.4%.

Three-month aluminium on the London Metal Exchange surged as much as 3.1% to $2,697 a tonne and was trading up 2.4% at $2,679.50 a tonne at 0749 GMT.

Aluminium has been one of the hardest hit sectors by the recent China power curbs due to the metal smelting process' high energy consumption.

The electricity curbs in China have slashed around 7% of domestic aluminium annual capacity so far this year, according to estimates from consultancy Wood Mackenzie.

The premium of LME cash aluminium over the three-month contract rose to $17 a tonne, the highest since Aug. 31, indicating tightening nearby supplies, as on-warrant inventories in LME warehouses fell to 587,900 tonnes, their lowest since December 2005.

Inventories in China , however, have risen slightly in recent weeks as the power shortage issues eased.

Other industrial metals also rebounded strongly, having been pressured by a firm dollar amid prospects of a rate hike in the United States and a liquidity crisis in the Chinese property sector, which consumes a large amount of metals.

"I think the market was over-sold. Fundamentals (for base metals) are good. People were too worried about real estate demand, ignoring the increment from new energy," said a Shanghai-based base metals trader, who added that the news of the aluminium smelter also helped boost the market.

FUNDAMENTALS

* Chinese refined copper spot premium surged to 1,225 yuan a tonne, a level unseen since April 2014, with traders attributing the rise to improving appetite for domestic material while supply is tight.

* ShFE copper inventories fell to 34,918 tonnes, the lowest since June 2009.

* ShFE nickel climbed as much as 4.2% to 147,840 yuan a tonne on demand hopes following a proposed change for Chinese batteries standard that could boost nickel demand, copper advanced 2.5% to 70,960 yuan a tonne, and tin rose 1.3% to 288,320 yuan a tonne.

* LME copper was up 1.8% at $9,609.50 a tonne, nickel gained 1.3% to $19,890 a tonne and zinc rose 1% to $3,192 a tonne.

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($1 = 6.3808 yuan) (Reporting by Mai Nguyen in Hanoi, Emily Chow in Shanghai and Dominique Patton in Beijing and Beijing newsroom; Editing by Shounak Dasgupta)