LME aluminium price drops $3,065/t with EGA Al Taweelah repairs, supply fears ease

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The London Metal Exchange (LME) aluminium price graph has been consistently reporting a decline for nearly 10 days since the June 22 close. As the Middle East tensions come to a settled state, supply fears have clearly started to ease.

Moreover, Emirates Global Aluminium (EGA) announced its ahead-of-schedule progress in restoring production at the Al Taweelah aluminium facility, which has already restarted 89 of its 1,262 reduction cells. This update, too, is expected to further drop aluminium prices as inventories are likely to be restocked before any major supply crunch. 

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On July 2, the LME aluminium cash bid price eased 0.39 per cent day-on-day, down from USD 3,073 per tonne to USD 3,061 per tonne. The offer shifted from USD 3,075 per tonne to USD 3,061.5 per tonne, indicating a 0.44 per cent decline.

In the near-term contracts, both the LME aluminium three-month bid and offer prices reported a 0.26 per cent drop. The bid shifted to USD 3,064.5 per tonne from USD 3,072.5 per tonne, as the offer slumped to USD 3,065 per tonne from USD 3,073 per tonne.

On the longer-dated contracts, too, both the Dec-27 bid and offer prices recorded a 2.83 0.4 per cent difference over the previous session. The bid closed at USD 3,010 per tonne, slipping from USD 3,022 per tonne, and the offer moved to USD 3,015 per tonne from USD 3,027 per tonne. 

Contrary to the declining trends, the LME aluminium 3-month Asian Reference Price closed at USD 3,091.5 on July 2, up 0.5 per cent from USD 3,076 per tonne on July 1. 

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LME aluminium stocks recorded a further decline as of July 2. The opening stocks slipped from 303,675 tonnes to 301,775 tonnes, marking a 0.63 per cent decrease.

Live Warrants remained steady at 246,600 tonnes.

On the other hand, cancelled warrants amounted to 53,675 tonnes, declining 2.72 per cent from 55,175 tonnes.

LME alumina Platts closed at USD 330 per tonne on July 2, unchanged from the previous close.

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