Base metals witnessed sharp gap down opening on MCX as fall in equities market on Monday triggered selling in non ferrous metals, later during the evening session speech by U. S. Treasury Secretary reduced anxiety amongst traders.

China's implied copper demand rose about 5 percent in March versus February on the back of record high imports, data showed on Wednesday. The world's biggest user of the metal consumed 621,325 tonnes of copper in March versus 591,000 tonnes in February, calculations based on trade data, output figures and Shanghai inventory numbers showed. Aluminium demand jumped 17.5 percent to over 1 million tonnes, while zinc consumption leapt by a third and lead use by more than 60 percent.

Nickel consumption fell 4.4 percent, possibly reflecting continuing weakness in the stainless steel industry, while tin, a key ingredient in solder, rocketed
133 percent higher. China's imports of refined copper rose 9.6 percent from the previous month to a record in March, on state and private stockpiling and as a replacement for shrinking scrap supplies. China, the world's top copper consumer, imported 296,843 tonnes of refined copper in March, up 137.6 percent on the year, Customs figures showed on Wednesday.

Global miner BHP Billiton on Wednesday forecast a 30 percent drop in annual output from the world's biggest copper mine, Escondida, as it posted falls in quarterly production across key commodities. The world's biggest mining house reported a surprisingly sharp drop of 14 percent in copper output for the March quarter, as well as expected falls in iron ore and aluminium production, and said it stood ready to halt operations as demand weakened.

The world copper market is expected to see a surplus of at least 345,000 tonnes in 2009, growing to around 400,000 tonnes in 2010, the International Copper Study Group (ICSG) said in a report on Tuesday. The Lisbon-based group expects world mine production to rise to 16 million tonnes in 2009, up
3.8 percent from 2008, and growing to 17.2 million tonnes in 2010.

Base Metals are likely to trade sideways to up during the day as copper inventory continues to remain negative with health cancelled warrants which might prevent sharp decline in prices. Zinc due to stock scenario might overtake Lead as difference between Zinc and Lead is Rs. 2 which might get bridged to Rs. 0.

Copper: Copper prices moved down-wards during the day yesterday, but pulled the prices upwards for close, forming a Hammer like candle. Prices also took support from the middle line of the Bollinger Band. Thus copper is expected to take support at 224 levels. Breaking this level can trigger further downside till 218.

Lead: Lead prices also moved up yesterday during close, but could not manage to close above the previous close. Thus prices even today can remain bearish below 74 levels, can fall to 70 levels.

Nickel: Nickel Prices moved sharply downside yesterday and closed lower. Prices moved and closed below the 590 levels (61.8% retracement), thus prices can move lower to 560 levels during the day.

Zinc: Zinc prices Moved lower during the day, but improved during the close. However, prices could not cross the 73.5 levels, thus the bearish sentiments still prevail in Zinc.