By Eric Onstad
LONDON, April 23 (Reuters) - Nickel prices hit a two-monthlow on Tuesday on signs of rising supply, while the wider marketwas mixed on conflicting signals about China's economy.
Data showed the deficit in the global nickel market for thefirst two months of the year narrowed sharply to 5,700 tonnesfrom 24,400 tonnes in the same period last year.
"I can see why nickel is under a bit of pressure. The datais still showing a deficit, but it's well below what we've seenover the last couple of years. And nickel ore prices are down tothe lowest levels in over a year," said Colin Hamilton, directorof commodities research at BMO Capital in London.
"The Chinese NPI (nickel pig iron) production is up thisyear so we are getting decent amounts of supply growth comingthrough."
Benchmark nickel
Nickel has shed 8 percent since touching a six-month peak inearly March but despite the losses is still the best performingLME metal so far this year with gains of 18 percent.
The LME reopened on Tuesday after the long Easter weekend.
* CHINESE STIMULUS: Metals markets felt the chill fromChinese shares, which on Monday extended sharp declines from theprevious session, as investors worried Beijing could slow thepace of policy easing following a stronger-than-expectedeconomic performance.
"People are worried that the accommodative policy may facean end," said Shanghai-based copper analyst He Tianyu of metalsconsultants CRU.
* CHINA SCRAP: China's scrap copper imports in March fell 54percent from a year ago to 100,000 tonnes, the second-lowestmonthly figure in records since June 2014.
"The copper scrap import numbers were very low, so that doespoint to a tightening copper market over the course of theyear," Hamilton said.
Three-month LME copper
* ALUMINIUM: LME aluminium found support after China'senvironment ministry reprimanded provincial officials inShandong, the country's biggest aluminium producing province,for failing to curb the growth of highly-polluting aluminiumoutput. Aluminium edged up 0.2 percent to $1,870.50 a tonne inofficial trading after touching the highest in more than twoweeks at $1,886.
* ALUMINIUM OUTPUT: Global primary aluminium output rose to5.414 million tonnes in March from a revised 4.916 milliontonnes in February, data showed.
* PRICES: LME zinc
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<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Top Base and Precious Metals Analysis - GFMS
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Additional reporting by Mai Nguyen in Singapore; Editing byMark Potter and Kirsten Donovan) ((eric.onstad@thomsonreuters.com; +44 20 7542 7093; Twitter
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