Chinese copper futures fell on Monday, dogged by lower global prices and an increasingly bearish domestic physical market. But Shanghai's copper futures continued to outperform the London Metal Exchange's benchmark three-month contract, which - despite scaling 16-year highs last week - stands just 1.6 percent higher compared with the end of 2004. The LME's three-month contract traded at $3,200.50 a tonne at 0718 GMT, down from $3,205.50 a tonne at the close of the Shanghai market on Friday.

It peaked Friday at $3,230 a tonne, its highest since January 1989. Shanghai's most-active May contract ended at 30,110 yuan ($3,638) on Monday, down 60 yuan from Friday's close. The most-active Shanghai contract has risen 3 percent compared with its close on December 31. Spot copper prices in Shanghai were assessed at 31,700-31,820 yuan on Monday, down 190 yuan from Friday.

Warehouse stocks monitored by the Shanghai Futures Exchange rose after trading closed Friday, underscoring a growing perception that there is ample physical supply in Chinese markets.

A total 107,190 lots of copper futures traded in Shanghai Monday, down from 161,102 lots Friday. Trading volumes were relatively low since US markets are closed Monday. Nearby Shanghai aluminium futures fell on Monday, defying a 0.4-percent rise in benchmark LME aluminium futures. A persistent contango in Shanghai aluminium attested to an overhang in prompt supply.

Most-active April aluminium ended at 16,430 yuan, down from 16,460 yuan at Friday's close. A total 26,570 lots of aluminium futures traded Monday, down slightly from 26,876 lots Friday.

Copyright Reuters, 2005