Alcoa Says Aluminum Use Recovering in China, Autos

NEW YORK, July 8 -- Alcoa Inc. Chief Executive Officer Klaus Kleinfeld said he's "very optimistic" about sales as the Chinese economy and U.S. automotive industry start to recover.

    "China is clearly out of the woods," Kleinfeld said in a Bloomberg Television interview in Moscow today. "Its economy has come back and is growing again." China reverted to being a net importer of aluminum this year, buying 700,000 metric tons of the metal in the first six months, he said.

    Aluminum has gained 5 percent in London trading this year, lagging behind other industrial metals such as copper and nickel as inventories soared and production exceeded consumption. Demand is strengthening in the U.S. and Europe, Kleinfeld said.

    "The engine is starting to get going again, which means you're going to need a replenishment of end-user demand as well as distributors no longer thinking that they need to have zero on their hands," James O'Mealia, chief investment officer of Sunnymeath Asset Management, said in a telephone interview.

    Alcoa rose 15 cents, or 1.6 percent, to $9.41 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have fallen 16 percent this year.

    "Things are bottoming out, and they are even coming back in some sectors," Kleinfeld said. "I'd mention the automotive sector" as one area of improvement, he said.

    (Source: Bloomberg)