(Updates with closing prices) By Eric Onstad LONDON, Feb 25 (Reuters) - Copper prices edged into the redon Tuesday as investors struggled to calculate whether anycoronavirus-related loss of metals demand would outweigh weakeroutput. Worries about the virus spreading outside of China hadpushed London Metal Exchange (LME) copper to a two-week low onMonday while zinc slid to its weakest since June 2016. Most LME prices bounced in Asian trading on Tuesday as someinvestors regarded the sell-off as exaggerated and others lockedin profits from bearish positions, but copper gave up its gainsin European activity. Three-month LME copper dipped 0.1% to $5,685 a tonnein final open-outcry trading.
"We initially estimated that the loss of Chinese demand forcopper could be in the region of 500,000 tonnes for this year,but that even looks optimistic," said Kieran Clancy at CapitalEconomics in London. "But a number of copper producers are struggling to sourceraw material and labour, so that is leading to some cutbacks.From a fundamental perspective that could be an offsettingfactor." The global copper market will probably end up in a surplusinstead of a previously expected deficit, Clancy added. * NICKEL: Prices gained support from potential supplyproblems after an official in Indonesia, the world's leadingnickel producer, said the coronavirus outbreak is likely todelay development of nickel projects worth about $11 billion. LME nickel rose 0.2% to finish at $12,450 a tonne,rebounding from its lowest in nearly eight months in theprevious session. * CHARGES: Spot treatment and refining charges for copperconcentrate in China touched their highest inalmost 11 months at $75 a tonne on Monday, according to AsianMetal, as virus-hit smelters' need for raw material drops. * ZINC POSITION: The net speculative short position in LMEzinc rose to 15% of open interest, close to last year's peak of16%, according to estimates by broker Marex Spectron. * ZINC TECHNICALS: Zinc remains under pressure, but isexpected to stabilise around the psychological $2,000 a tonnemark, Commerzbank technical analyst Axel Rudolph said in a note. "Failure at the $2,000 mark and the March 2015 low at$1,981.00 would make us medium-term bearish."
* PRICES: LME aluminium added 0.2% to close at$1,703 a tonne, zinc shed 0.8% to $2,030, lead gained 2.1% to $1,858 and tin rose 1.1% to $16,725. * For the top stories in metals and other news, click or (Additional reporting by Mai Nguyen in Hanoi and Tom Daly inBeijingEditing by David Goodman/Kirsten Donovan/Jane Merriman)
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