CARACAS, Jan. 6 -- Venezuela's decision to cut aluminum output to save electricity is being "shrugged off" as global supplies grow faster than demand, said Douglas Horn, a commodity analyst at CPM Group.

"I've been surprised that prices haven't reacted more positively," Horn said today in a telephone interview from New York. "There is a ton of aluminum supply out there. There's plenty of cushion."

Corp. Venezolana de Guayana, the holding company of Venezuela's state metal producers, said last month it would cut output by 40 percent at Venalum, an aluminum smelter with capacity to produce 430,000 metric tons a year. It also started dismantling two production lines at the 210,000 ton-a-year Alcasa smelter and shut four furnaces at the Siderurgica del Orinoco steel mill.

Primary aluminum for delivery in three months rose $35, or 1.5 percent, to $2,302 a ton today on the London Metal Exchange. The metal has climbed 2 percent since Venezuela announced the cuts on Dec. 23, while copper has jumped 6.9 percent.

Venezuela is rationing power after the El Nino weather pattern reduced water levels in the Guri dam, which provides 70 percent of the country's electricity.