Aluminum Prices Hit a 15-month High As Energy Prices Rise-Shanghai Metals Market

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Aluminum Prices Hit a 15-month High As Energy Prices Rise

Industry News 02:23:30PM Nov 01, 2016 Source:MetalMiner

by  on NOVEMBER 1, 2016

Three-month LME aluminum price hits 15 month high. Source: Fastmarkets.com.

Aluminum prices hit new highs this week, rising above $1,700 per metric ton on the London Metal Exchange. Aluminum supply has increased this year as rising aluminum prices triggered release of new capacity and restarts of idled capacity. However, as we recently pointed out, there are other factors pushing aluminum prices up:

Rising Costs

It takes a lot of energy to smelt aluminum. Indeed, energy accounts for around half of the cost for Chinese smelters to produce aluminum.

Thermal coal prices in China have more than doubled this year. As energy prices increase, Chinese smelters are getting squeezed, making it tougher for them to keep up with production. Alumina prices in China have also entered the upward track from mid-August, increasing around 50% so far this year.

Strong Demand

Chinese demand from infrastructure and construction has been robust this year. The auto sector, another big industry for aluminum demand, continues to look strong. In September, Chinese automobile sales rose 27% from the same period last year. This is the seventh consecutive month in which auto sales have risen and the third consecutive month where growth was above 20%. The growth rate this year is substantially higher than last year.

What This Means For Metal Buyers

Industrial metals have been in bullish mode since early this year. Aluminum prices are finally jumping on the bandwagon. Aluminum buyers should minimize their price risk exposure if they haven’t done it yet.

Key Words:  aluminum prices  LME aluminum 

Price

more
Aluminum Ingot
Apr.25
14230.0
80.0
(0.57%)
Alumina (Averaged)
Apr.25
2715.0
10.0
(0.37%)
Alumina-East
Apr.25
2720.0
10.0
(0.37%)
Alumina -Central
Apr.25
2720.0
10.0
(0.37%)
Alumina - North
Apr.25
2710.0
10.0
(0.37%)

Aluminum Prices Hit a 15-month High As Energy Prices Rise

Industry News 02:23:30PM Nov 01, 2016 Source:MetalMiner

by  on NOVEMBER 1, 2016

Three-month LME aluminum price hits 15 month high. Source: Fastmarkets.com.

Aluminum prices hit new highs this week, rising above $1,700 per metric ton on the London Metal Exchange. Aluminum supply has increased this year as rising aluminum prices triggered release of new capacity and restarts of idled capacity. However, as we recently pointed out, there are other factors pushing aluminum prices up:

Rising Costs

It takes a lot of energy to smelt aluminum. Indeed, energy accounts for around half of the cost for Chinese smelters to produce aluminum.

Thermal coal prices in China have more than doubled this year. As energy prices increase, Chinese smelters are getting squeezed, making it tougher for them to keep up with production. Alumina prices in China have also entered the upward track from mid-August, increasing around 50% so far this year.

Strong Demand

Chinese demand from infrastructure and construction has been robust this year. The auto sector, another big industry for aluminum demand, continues to look strong. In September, Chinese automobile sales rose 27% from the same period last year. This is the seventh consecutive month in which auto sales have risen and the third consecutive month where growth was above 20%. The growth rate this year is substantially higher than last year.

What This Means For Metal Buyers

Industrial metals have been in bullish mode since early this year. Aluminum prices are finally jumping on the bandwagon. Aluminum buyers should minimize their price risk exposure if they haven’t done it yet.

Key Words:  aluminum prices  LME aluminum