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Copper dropped the most in three months in London, trading below $6,000 a ton, on expectations a private report will show U.S. manufacturing industry is stagnating. Zinc had its largest drop in more than six weeks.

Copper, used in wires and pipes, is erasing part of last year's 44 percent gain as supplies increase and consumption growth slows. U.S. manufacturing was on the verge of shrinking in December, economists expect a report from the Institute for Supply Management to show today. The U.S. is the second-largest user of copper, after China.

``We will see more weakness in demand and prices in 2007,'' said Jean-Bernard Guyon, who manages about $211 million at Global Gestion France in Paris. Guyon doesn't hold copper- related stocks and has reduced his holdings in nickel and zinc shares, he said without elaborating.

Copper for delivery in three months on the London Metal Exchange lost $218, or 3.6 percent, to $5,892 a metric ton as of 2:22 p.m. local time. It's the first time copper has traded below $6,000 since April 12. The contract earlier fell as much as 4.6 percent, the largest intraday loss since Oct. 4. Zinc, used to galvanize steel, had its largest one-day loss since Nov. 17, falling as much as $210, or 5.1 percent, to $3,920 a ton.

The ISM's manufacturing index was at 50 in December, compared with 49.5 in November, according to the median forecast of 60 economists surveyed by Bloomberg News. A reading below 50 signals a contraction. The November reading was the first slowdown in more than three years. The Tempe, Arizona-based institute will release the report at 10 a.m. Washington time.

Price Quadruples

Copper futures for March delivery fell 19.55 cents, or 6.8 percent, to $2.6755 a pound on the Comex division of the New York Mercantile Exchange. A close at that price would mark the biggest percentage drop since June 13.

The metal has quadrupled since 2002, and traded at a record $8,800 a ton May 11, as China's booming economy combined with strikes and disruption at mines from Indonesia to Chile to put a squeeze on supplies. Mining companies such as Chile's Codelco, the world's biggest producer, and BHP Billiton Ltd. have since ramped up production to take advantage of the higher prices.

``The scarcity fear is going to disappear,'' said Peter Fertig, a commodity analyst at Dresdner Kleinwort in Frankfurt. A U.S. slowdown ``clearly reduces demand for the metal.''

Further declines in copper are likely, said analysts including Neil Buxton at London-based GFMS Metals Consulting Ltd. A drop below $6,000 a ton would trigger more technical chart-based selling, sending prices toward $5,000, Fertig said. He expects prices to rebound on increased orders from China later this year.

Goldman Sees $5,500

``We have a lot of people sitting on the fence, waiting to place orders,'' said Charles Molnar, owner of Molnar Tools Inc. in Ocean, New Jersey. ``They are waiting for prices to come down.'' Molnar uses about 200,000 pounds of copper a year.

Copper's so-called relative strength index dropped to 21.39 today, suggesting a rebound. The index is used by some investors as a gauge for price direction. A reading below 30 usually indicates the commodity is due for a gain.

The benchmark three-month price probably will fall to $5,500 by the end of this year as supply beats usage by 230,000 tons, Goldman Sachs Group Inc. analysts led by James Gutman in London said in a Dec. 11 report.

LME-monitored copper inventories gained 1,975 tons, or 1 percent, to 192,550 tons, the exchange said today in a daily report. The stockpiles more than doubled last year, easing a shortage.

Mining Stocks Drop

Mining stocks also dropped. Shares of BHP Billiton lost as much as 3.4 percent in London, the most in more than three weeks. Xstrata Plc, the world's second-largest producer of nickel and fourth largest for copper, fell as much as 5.3 percent.

Some producers tried to take lock in copper prices before further declines. Boliden AB, Scandinavia's only copper producer, extended its hedging program by two years through 2009 to secure funds for its 5.3 billion kronor ($780 million) expansion of the Aitik mine.

The company has sold 70 percent of its 2007 production at an average price of $6,394 a metric ton, Stockholm-based Boliden said today in a statement. Seventy percent of output in 2009 is hedged at $5,920.

Other LME-listed metals contracts declined. Aluminum dropped $70 to $2,715 a ton and nickel fell $175 to $32,300. Lead slipped $2 to $1,650, and tin was $475 percent lower at $10,975.