LME aluminium price rises to US$3,560/t as Russia’s new natural gas supply policy may impact metal production; SHFE escalates at US$3,653/t

LME aluminium opened at US$3,417 per tonne on Wednesday, March 23, and closed at US$3,685 per tonne, an increase of US$179 per tonne or 5.12 per cent.

LME aluminium cash bid price stood at US$3,558 per tonne with a rise of 0.22 per cent or US$8 per tonne and LME aluminium official settlement price settled at US$3,560 per tonne with an increase of 0.27 per cent or US$9.50 per tonne, comparing the records of Tuesday.

3-month bid price grew by US$8 per tonne to rest at US$3,558 per tonne and 3-month offer price had a raise of US$9.50 per tonne to close at US$3,560 per tonne. On the same day, December 23 bid price and December 23 offer price stooped by 0.54 percent to US$3,307 per tonne and US$3,312 per tonne, respectively.

The price of Natural gases soared 34 per cent in Europe following the announcement made by Russian President Vladimir Putin, where he said from now on the Russian export of natural gas to European Countries would be settled in rubles. Russia, which produces about 6% of the world's aluminium and supplies nearly 10% of its nickel needs, is also a major producer of natural gas used to generate electricity that powers aluminium production. The sudden price hike in natural gases might be responsible for lower production and last inventory trading with a gradual but substantial increase in aluminium price.

LME aluminium opening stock continued to decrease from 695,825 tonnes to 689,575 tonnes as of March 23^nd. Live warrants totalled 440,900 tonnes recording a fall of 3,550 tonnes and Cancelled warrants witnessed a rise of 2750 tonnes resting at 248675 tonnes.

The LME aluminium 3-month Asian Reference Price inched up by 0.10 per cent to stop at US$3,531.50 per tonne.

SHFE aluminium price    

On Thursday, March 24, the benchmark aluminium price for SHFE has hiked by US$54 per tonne or 1.5 per cent to stand at US$3,653 per tonne, witnessing the first rise after last Monday.

Overnight, the most-traded SHFE 2205 aluminium contract opened at RMB 23,260 per tonne, with the highest and lowest prices at RMB 23,435 per tonne and RMB 23,130 per tonne before closing at RMB 23,365 per tonne, up RMB 385 per tonne or 1.68 per cent.

The most-traded SHFE 2205 aluminium closed up 0.28 per cent or RMB 65 per tonne to RMB 23,085 per tonne, with open interest down 139 lots to 238,252 lots.