Aluminium prices fall as Chinese aluminium product export rises

On Monday, the aluminium prices were on a decline due to the heavy aluminium product exports from China.

The three-month-aluminium slipped by 1.05% at the LME taking the price to $2,033.50 a tonne. The volume was also heaviest on the LME at nearly 16,500 lots.

Over the weekend it was seen that the Chinese unwrought aluminium moved at an impressive pace in the market. Products exports were seen to rise by 12.5% in October on a year to date basis. Robin Bhar, the head of metals research at Societe Generale in London, said that the deficit of the metal in the world outside China is being quickly met by the Chinese product exports.

Although the export of 380,000 tonnes in October was down by 5% when compared to September, on a YOY basis it was 19% higher and is expected to rise further in the coming months as Chinese smelters increase their capacities, says Ivan Szpakowski, an analyst at Citi in Shanghai.

"This growth in Chinese exports has had a notable weakening impact on Asian aluminium markets, and cargoes are being diverted to the Middle East, Turkey and southern Europe," he said in a note.