LME aluminium ends week-long bumpy ride on a high note

LME aluminium had a bumpy ride this week. The lightmetal, finding applications in a wide range of industries- from smartphones to spacecraft, felt the ripple effect that was generated ahead of the Federal Reserve’s meeting on interest rate decisions. LME aluminium opened the week at US$1,880 per tonne range and then came down to close at US$1,851 per tonne on Tuesday, March 14, as the US dollar index rose prior to the Fed’s  meeting on Wednesday. The contract gained again after the Fed raised the interest rate and the US dollar index tumbled. Though the analysts say the dollar index is on its way to resuming its uptrend, the base metals are still drawing in strength from its lows.

LME aluminium has risen to close at US$1,901 per tonne after Friday’s night trading, up 1 per cent from its early week close at US$1,882 per tonne on Monday, March 13. According to Reuters, the contract may break a support at US$1,891 per tonne and fall towards the next support at US$1,850, as suggested by its wave pattern and a Fibonacci retracement analysis.

The LME official Stock of aluminium has come down from 2068525 tonnes in the beginning of the week to 1996000 tonnes on Friday, March 17.

As on March 16, LME Aluminium US Premium stands unchanged at US$ 215, LME Aluminium West-Europe Premium at US$ 95, LME Aluminium East-Asia Premium at US$100 and LME Aluminium South-East Asia Premium at US$15 (per tonne).

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In China, the benchmark price of aluminium on Shanghai Metal Exchange (SME) maintained its position at US$1,960 per tonne range with slight variations throughout the week. It touched an intra-week low at US$1,945 per tonne on March 15 and peaked at US$1,970 per tonne the day before closing the week at US$1,969 per tonne.

The average aluminium price of A00 aluminium ingot, as surveyed by Shanghai Metals Market (SMM), stands at RMB 13,518 per tonne.

The base metal production in China advanced during the first two months of 2017 as the country's major smelters ramped up production buoyed by rising aluminium prices, reported SMM.

According to China’s National Bureau of Statistics, Chinese aluminium production gained by 15.6 per cent year-on-year to total at 5.49 million tonnes during January and February 2017.