* GRAPHIC-2019 asset returns:
* Prices supported by market caution on Alunorte
* Alumina market tight while aluminium market well supplied (Adds official prices, fresh quote, bullets, nickel)By Zandi ShabalalaLONDON, March 27 (Reuters) - Aluminium touched a one-weekhigh on Wednesday as inventories fell and prices shrugged offanother step towards a full restart of Norsk Hydro's Brazil alumina operations.Hydro said it had agreed with the Brazilian government for athird party to conduct a technical assessment on two clearancesthat, if confirmed, could lead to a full ramp-up in output atits Alunorte refinery. The plant has been operating at half capacity since early2018.
Uncertainty over whether Alunorte will gain final approvalto restart, given a series of conflicting rulings over a lethaldam breach at miner Vale in January, is keepingprices supported, Julius Baer analyst Carsten Menke said. "We need to be cautious in terms of regulatory aspects inBrazil at the moment considering how volatile the news flow hasbeen around Vale, with courts allowing restarts and other courtsblocking it again," he said.Benchmark aluminium closed 1.3 percent higher at$1,911 per tonne after touching its highest since March 21at$1,919.50.
At full capacity Alunorte can produce some 6.4 milliontonnes of alumina - the raw material for aluminium - or 10percent of the world's capacity outside China.
"The alumina market is still very tight in the near term andthe Hydro announcement is still aspirational and will take sometime yet to bring back production," a senior merchant tradersaid."I don't feel it changes anything for the next threemonths."
ALUMINIUM STOCKS: Headline aluminium stocks in LME-approvedwarehouses fell 7,000 tonnes to 1.14 million tonnes, the lowestsince mid-December. However, cash aluminium is trading at a $19.25 a tonnediscount to the three-month contract, against a premium of$16.75 in December, indicating supply concerns have eased. "The aluminium market, in contrast to expectations about sixmonths ago, is not tight at all," said Julius Baer's Menke."We are seeing constant record high exports from China,which is a consequence of sufficient supplies but also weakdemand driven by weakness in the car sector in China."ZINC: The premium of cash LME zinc over the three-monthcontract was at $56 a tonne from $47 in the previoussession as LME stocks hit a record low of 55,225 tonnes. NICKEL: Indonesia's nickel-related industries such as theproduction of stainless steel and battery materials are set tosurpass the value of its second-biggest export earner, palm oil,in the next 10 to 15 years, its investment board chief said onWednesday. PRICES: Copper ended barely changed at $6,335 pertonne, zinc rose 0.5 percent at $2,887, tin gained 0.4 percent to $21,350, and nickel shed 0.3percent to $13,060.Lead was up 0.7 percent to $2,007 per tonne afterfalling to a two-month low of $1,985.50 per tonne.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Jan Harvey and Alison Williams)