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Aluminium hits three month low as stocks ramp up

Metal News - Published on Mon, 19 Mar 2018

Image Source: brecorder.com
Reuters reported that aluminium slid to a three month low hurt by a jump in stocks, the spectre of US import tariffs and expectations that supply from China will increase as its winter pollution controls end. A rise in the dollar against the euro ahead of next week’s Federal Reserve policy meeting pressured base metals more broadly, meanwhile, sending tin to a seven-week low.

As well as their direct effect on aluminium, which could see a supply surplus if exporters to the United States are obliged to sell their metal elsewhere, the threats of tariffs hurt base metals generally by sparking fears of a trade war.

Mr Norbert Ruecker head of macro and commodities research of Julius Baer, said that “If you look at the impact, the trade tariffs will, in the end, be deflationary globally.” He said that other factors were also pressuring aluminium.

Mr Ruecker said that “We see the end of the capacity cuts to China, with the end of the winter heating season.” Mr Ruecker added that “Production has been holding up better than expected, supply, looking at inventories, has been increasing, and these earlier fears that we could have some tightness have just not materialised.”

ALUMINIUM
London Metal Exchange aluminium fell to its weakest since Dec. 19 at USD 2,070.50 a tonne before closing 0.2 % down at USD 2,085.

HEATING SEASON ENDS
China’s winter heating season ended. Aluminium smelters in 28 northern Chinese cities had been told to reduce output by at least 30 % from Nov. 15 to March 15, though the actual volume cut was below expectations and applied pressure on prices.

Source :

Posted By : Rabi Wangkhem on Mon, 19 Mar 2018
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