* Trade war fears to cap prices of industrial metals
* Aluminium supported by higher raw material costs (Updates with closing prices)By Pratima DesaiLONDON, Sept 6 (Reuters) - Copper prices rose on Thursdaydue to funds covering short positions and recent dollarweakness, but significant gains are unlikely due to anescalating trade dispute between the United States and China.Benchmark copper on the London Metal Exchange endedup 0.9 percent at $5,927.5 a tonne in official rings.That is a recovery from the 14-month low of $5,773 a tonnehit on August 15 for the metal used in the power andconstruction industries, but prices are still down about 20percent since a 4-1/2 year high of $7,348 hit in June."Copper tested the lows again and couldn't get through.There's been a lot of short-covering, profit-taking and thedollar is lower, which helps," a copper trader said."But there is a lot of nervousness about the U.S.-Chinatrade war, that will keep the bulls at bay."
DOLLAR: A lower U.S. currency makes dollar-denominatedmetals cheaper for holders of other currencies, which couldboost demand. This relationship is used by funds to generate buyand sell signals from numerical models. TRADE: U.S. President Donald Trump has said he is preparedto quickly ramp up a trade war with China and has told aides heis ready to impose tariffs on $200 billion more on Chineseimports as soon as a public comment period on the plan ends. The world's two largest economies have already appliedtariffs to $50 billion of each other's goods in a tit-for-tattrade war. Talks aimed at easing tensions ended last weekwithout a major breakthrough.DEMAND: China is the world's largest copper consumer,accounting for nearly half of global demand estimated at around24 million tonnes this year. The U.S. accounts for about eightpercent of global demand.China is also the world's largest consumer of otherindustrial metals such as aluminium, zinc, lead and nickel.PERFORMANCE: "Base metals were among the worst performers inthe commodity space as growing U.S.-China trade tensions alongwith signs of slowing growth in China took a toll," said INTLFCStone analyst Edward Meir.ALUMINIUM: Prices of the metal used in transport andpackaging are to an extent supported by worries about suppliesdue U.S. sanctions on Russian aluminium producer Rusal and higher input costs.ALUMINA: "Higher cost aluminium smelters have been underpressure as prices of the key raw materials alumina and thermalcoal have rallied - alumina and power account for 80 percent ofoperating costs," BoA Merrill Lynch analysts said in a note.PRICES: Aluminium was down 1.3 percent at $2,040 atonne, zinc gained 0.9 percent to $2,441, lead slipped 0.7 percent to $2,035, tin gained 0.1 percent to$18,850 and nickel was little changed at $12,445.<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Pratima Desai; editing by Alexander Smith, DavidEvans, William Maclean)