China - Shanghai aluminium hits 4-year low, smelters resist cuts

Shanghai aluminium futures fell 1.8 percent on Wednesday to their lowest in four years on concerns over swelling stockpiles and worries China's smelters will continue to churn out metal despite weak demand.

China's copper market also fell, chasing an almost 4 percent loss in London on worries that the U.S. government's $700 billion answer to the financial market crisis will bog down the economy.

Shanghai December aluminium fell as much as 285 yuan, or 1.8 percent, to 15,360 yuan ($2,255) soon after the open, after London Metal Exchange stocks jumped by another 3,050 tonnes overnight. LME aluminium rose $2 to $2,510 at 0245 GMT.

Earlier this week, China's top aluminium producer Chalco said it planned to maintain output despite low prices that are well below production costs of about 17,000 yuan faced by smaller, higher-cost smelters in China.

Most-active Shanghai December copper fell 1,220 yuan, or 2.3 percent to 52,850 yuan a tonne. London Metal Exchange copper drifted down $5 to $6,975, after sliding $270 overnight.

With financial markets, including commodities, seeing unprecedented levels of volatility, investors are willing to make anything but the smallest bets on direction.

At the start of the week, relief about the U.S. Treasury's plan to quarantine toxic debt sent copper prices to its highest this month, before giving way to worry about how much the deal would cost and its longer term impact on the economy.

The dollar arrested its slide against the euro slamming the rally in commodities seen since late last week into reverse.

But sentiment got a boost from another weighty drawdown in copper stocks. Inventories have fallen nearly 8,000 tonnes this week, mostly as material left warehouses in South Korea, likely

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