IAI will stop reporting aluminium inventory updates due to insufficient data

The International Aluminium Institute has declared that they would no longer report the global inventory stocks making it even more difficult to estimate the actual aluminium stocks available across the world.

It is already accused that the price of aluminium is manipulated by banks and traders who hoard the metal in both LME-registered warehouses as well as offsite warehouses to hike up the prices and making it difficult to pinpoint exactly how much metal is actually available in the market.

Rental revenues are another way the hoarders generate earnings boosting the aluminium premiums, the amount paid above the LME price to attain the physical metal. The premiums are still high despite the various regulatory scrutiny and reforms in the LME warehouse rules.

IAI said in a statement that they will not be reporting the aluminium stock numbers since the numbers they are receiving from global smelters are incomplete and insufficient to produce an accurate picture of the aluminium inventory stocks.

Starting second half of last year as many as 35 smelters, which is a third of the number of smelters reporting to IAI, either stopped or had difficulties reporting stock updates on a monthly basis.

"(We) understand that many analysts ... have used the IAI inventory reports as part of their information-gathering process, however, we do not consider the data ... is now adequately reflecting a true picture of global producer stocks," said the IAI.