04 AUGUST 2011alu.com
Short term weakness in aluminum, followed by strength
Edited by : AL CIRCLE
1 min read
Harbor Intelligence anticipates price weakness for aluminum in the short term, but “substantial” upward pressure afterward. Prices rose in July, supported by good physical demand, plus recovering demand for secondary Aluminium from the global auto sector, Harbor says. Funds built slight long positions.
“Market conditions have been especially tight in China, where prices reached a 40-month high and trade in backwardation,” Harbor says. Still, Harbor cautions of possible weakness in the near term, with support around $2,500 to $2,450 a metric ton, or 113 to 111 cents a pound. Chinese monetary tightening and debt issues in the U.S. and Europe have dented market confidence, and end-user demand has slowed. Seasonal weakness can’t be ruled out for the next one and one-half months, Harbor says.
“Market conditions have been especially tight in China, where prices reached a 40-month high and trade in backwardation,” Harbor says. Still, Harbor cautions of possible weakness in the near term, with support around $2,500 to $2,450 a metric ton, or 113 to 111 cents a pound. Chinese monetary tightening and debt issues in the U.S. and Europe have dented market confidence, and end-user demand has slowed. Seasonal weakness can’t be ruled out for the next one and one-half months, Harbor says.
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