LME aluminium hit US$1,9000/tonne last week on Chinese smelter worries

LME aluminium hit US$1,900 per tonne this week surging 13 per cent so far since January this year. One of the factors supporting the rise has been, of course, the faltering U.S. dollar index. The DXY which measures the greenback’s strength against a basket of six major currencies, plunged on February 15, Wednesday, and the slide followed through Thursday. The other factor supporting the price rise has been aluminium supply concerns arising out of China. There were fewer smelter restarts than expected in the latter half of 2016, production costs in the country have spiralled up, and now, many smelters are being forced to halt operations after coming under the scanner of the government-controlled environment protection authorities. It looks like China is taking air pollution rather seriously.


Midwest aluminium premiums continued to climb in February, hitting an almost three-year high. Metal Miner predicts, aluminium premiums will rise even higher this year due to ongoing trade tensions in the international market.

      Source: MetalMiner IndX

Warrants for aluminium stocked in the London Metal Exchange registered warehouses in Asia are trading at almost twice as high as in end of last year, tracking the US spot physical premiums, traders said Friday. The Platts Midwest Transaction premium, basis delivered Midwest, has stood at a near two-year high of 10 cents/lb ($220 per tonne since February 6, reported Hellenic Shipping News.

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In China, Shanghai Metal Exchange benchmark price of aluminium has also logged an impressive rise this week. Starting at US$1,980 per tonne on Monday, February 13, the lightmetal rose 2.87 per cent to close at US$2,037 per tonne on Friday. SHFE aluminium traded moderately this week and kept diverging under the dual effect of a weak dollar and supply uncertainty in the regional market.

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