Jan 30 (Reuters) - Copper prices fell on Monday, as weak physical consumption prompted reassessment of how quickly and strongly demand would rebound in top consumer China following its COVID-19 restrictions removal last month.
The most-traded March copper contract on the Shanghai Futures Exchange fell 1.2% to 69,330 yuan ($10,262.79) a tonne by 0752 GMT as trading resumed after a week-long Lunar New Year holiday, while three-month copper on the London Metal Exchange dipped 0.8% to $9,184 a tonne.
Copper prices since mid-July 2022 have risen 28% in London and 34% in Shanghai, underpinned by hopes of demand recovery in China post dismantling of the "zero-COVID" policy.
However, physical copper demand remained tepid, as shown by
falling premiums
China's factory activity in January is expected to have contracted more slowly than in December, a Reuters poll showed, with production hampered as workers continued to fall sick after the government relaxed rules.
"Copper prices have risen to a relatively high level, and the reality may be difficult to make a positive response in the short term," Jinrui Futures said in a note.
"It is expected that copper prices may face a certain risk of a correction after the (New Year) festival."
However, a weaker dollar and supply threats in Peru where MMG Ltd's Las Bambas mine would likely have to halt production from Feb. 1 due to a shortage of "critical supplies", provided some support to copper prices.
LME aluminium fell 1.1% to $2,599.50 a tonne and tin dropped 2.5% to $30,075 a tonne, and lead edged up 0.1% to $2,185 a tonne.
SHFE nickel rose 2.7% to 219,960 yuan a tonne and tin jumped 2.1% to 236,870 yuan a tonne, while aluminium fell 0.6% to 19,000 yuan a tonne and zinc shed 1.7% to 24,175 yuan a tonne.
LME cash zinc was at a $25.25 per-tonne premium over the
three-month contract
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($1 = 6.7545 yuan) (Reporting by Mai Nguyen in Hanoi; Editing by Subhranshu Sahu and Rashmi Aich)