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Unreported Chinese copper stocks account for 48% of estimated total stocks, said analysts Stephen Briggs, Nick Moore and Daniel Major.
Unreported zinc stocks account for 46% of total estimated stocks; the same comparison for nickel is 34% and 17% for aluminum.
China's base metals market had seemed primed for a swift recovery because reported stocks for most of the base metals are currently much lower than at this stage in previous cycles, RBS said. Reported stocks for copper, for example, stand at 3.6 weeks of consumption versus eight weeks in 2002.
"When unreported Chinese stocks are included, total stocks are at comparable levels seen in previous cycles - for example, copper at seven weeks," RBS wrote.
The bank sees nickel as most exposed, with prices expected to fall 10% over the next 12 months, as unreported stocks have pushed total stocks to 19 weeks of consumption.
On the other hand, RBS sees "the greatest upside for aluminum over the next 12 months, with the price expected to rise by 11%."
-By Chuin-Wei Yap, Dow Jones Newswires; 8610 8400 7704; chuin-wei.yap@dowjones.com
(END) Dow Jones Newswires
11-08-09 2134ET
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