* GRAPHIC-2019 asset returns:
* Premium for cash over 3-month zinc highest since 1997 (Updates with closing prices)By Pratima DesaiLONDON, May 20 (Reuters) - Zinc prices hit four-month lowson Monday as investors frettedabout rising supplies from topproducer China, while industrial metals overall came underpressure from trade tensions between the United States andChina.Benchmark zinc on the London Metal Exchange endeddown 1.0% at $2,575 a tonne. Earlier, prices of the metal usedto galvanise steel touched $2,553, the lowest since Jan. 22. Itis down about 9% so far in May."There was another wave of selling this morning. The idea ofmuch higher zinc supplies in China in the second half has hitsentiment," a zinc trader said.
"It looks like there isn't going to be a resolution to thetrade dispute any time soon, that uncertainty will keep uppressure on the base complex."
ZINC: Analysts expect China's zinc production to climbaround 5% in May from April to above 560,000 tonnes. Highernumbers are expected in the second half as new capacity rampsup.A Reuters survey published earlier in May shows analysts onaverage expect a surplus of 20,000 tonnes this year after yearsof deficits, in a market estimated around 14 million tonnes. POSITIONS: "Speculative positioning in zinc as of lastThursday shifted from flat to a net short of 2.1% of openinterest or 3,300 lots (82,500 tonnes)," Marex Spectron analystssaid in a note. "Whilst relatively small, this is a level notseen since Dec. 2018".STOCKS: However, low stocks of zinc in LME-approvedwarehouses, at 104,850 tonnes from above 250,000 tonnes inAugust last year, and large holdings of LME warrants arefuelling nervousness about shortages on the LME market.This can be seen in the premium or backwardation for thecash over the three-month contract which ended at a 20-year high$150.50 a tonne on Friday. TRADE: No further trade talks between top Chinese and U.S.negotiators have been scheduled since the last round ended onMay 10 - the same day Washington raised the tariff rate on $200billion worth of Chinese products to 25% from 10%. PRICES: Copper ended 0.4% down at $6,029 a tonneafter earlier touching $6,004, its lowest since Jan. 29.Aluminium lost 2.1% to $1,797.5, lead slipped 1.2% to $1,804, tin ceded 0.3% to $19,450.Nickel was untraded at the close, but was 0.3% lower at$11,980 on the LME's electronic system.DEAL: Aluminium came under pressure after the United Stateson Friday struck deals to lift tariffs on steel and aluminiumimports from Canada and Mexico. Most of the impact is expected to be seen in the physicalmarket premium -- paid above the LME price -- for aluminiumconsumers in the United States. Last week the premium was above$400 a tonne.<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Pratima Desai; editing by Emelia Sithole-Matariseand Ed Osmond)