MELBOURNE: London copper slipped to its weakest in 3-1/2 weeks on Monday as inventories pile up ahead of year-end, while lead and zinc posted steep falls on profit-taking after strong fourth-quarter gains.
Copper prices have come under selling pressure this month as traders book profits on November's stellar rally, and after warehouse stocks jumped 44 percent last week as metal is delivered to tidy books ahead of year-end.
"I think it's a bit seasonal ... for the time being, overall sentiment is bullish," said analyst Helen Lau of Argonaut Securities.
London Metal Exchange copper was down 0.3 percent at $5,617 a tonne at 0310 GMT, after hitting its lowest since Nov. 23 at $5,600 a tonne earlier in the session. It dropped 1.7 percent on Friday, but prices are up by 19 pct so far this year.
Hedge funds and money managers raised their net long position in copper futures and options to a record for the sixth straight week, the latest U.S. Commodity Futures Trading Commission data showed.
In China, Shanghai Futures Exchange copper slipped 1.5 percent to 45,950 yuan ($6,617) a tonne, also hit as traders square their books ahead of January. New signs that China's housing market has cooled also dragged.
China's property market slowed further last month, with average new home prices in the nation's 70 major cities cooling from October.
Meanwhile, ShFE lead and zinc dived 6.5 percent and 2.7 percent respectively, trimming the quarter's gains to 25 percent and 22 percent.
Providing background support, Beijing's city government has ordered 1,200 factories near the Chinese capital, including an oil refinery run by state oil major Sinopec, to either shut down or cut output following its highest possible air pollution warning.
Elsewhere, senior politicians in Indonesia last week warned that the country needed to revise its mining law to ease a ban on mineral ore exports and is unlikely to meet a deadline of early next year for the change. The nation was until 2014 the world's top nickel ore exporter.
Indonesian state-controlled miner PT Aneka Tambang Tbk (Antam) may not have the cash flow for downstream investments worth at least $500 million if the ban on nickel ore exports is not eased, an executive said.
Reflecting low available supply of nickel ore, China's portside nickel stocks have slumped to the lowest in 5 years at 1.267 million tonnes.
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