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Aluminum prices driven by financials - Norsk Hydro
Edited by : AL CIRCLE
1 min read
Reuters cited Mr Jorgen Rostrup CEO of Norsk Hydro as saying that financing deals were helping to drive aluminium prices but they still had performed poorly compared with other base metals.
Mr Jorgen Rostrup said that there seems to be a willingness to invest in these inventories to keep them off the market with returns that can be locked in therefore you has the prices that you have.
He said that it is still a tight aluminium balance in the physical market. That is part of what sets the price but obviously the price is also set by financial things.
Metal industry sources estimate these deals have tied up a hefty 70% or 3.3 million tonnes of record high aluminum stocks 4.7 million tonnes in London Metal Exchange registered warehouses.
Difficulty in accessing LME aluminium is also part of the reason why prices of the benchmark three-month contract CMAL3 rose to above USD 2,800 per tonne, the highest since August 2008.
Mr Jorgen Rostrup said that there seems to be a willingness to invest in these inventories to keep them off the market with returns that can be locked in therefore you has the prices that you have.
He said that it is still a tight aluminium balance in the physical market. That is part of what sets the price but obviously the price is also set by financial things.
Metal industry sources estimate these deals have tied up a hefty 70% or 3.3 million tonnes of record high aluminum stocks 4.7 million tonnes in London Metal Exchange registered warehouses.
Difficulty in accessing LME aluminium is also part of the reason why prices of the benchmark three-month contract CMAL3 rose to above USD 2,800 per tonne, the highest since August 2008.
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