Global Aluminum Production Falls, But So Do Aluminum Prices
MetalMiner | Oct 22, 2019 03:19AM ET
According to the International Aluminum Institute, global aluminum production totaled 5.16 million tons in September, down from 5.33 million tons in August and 5.30 million tons in September 2018.
Get The News You Want
Get The News You Want
Despite the decline in production, prices have not received a boost — in fact, the LME aluminum price per pound is hovering at around $0.78 per pound.
Get The News You Want
Top producer China saw its production levels dip again last month.
Get The News You Want
Chinese aluminum production totaled an estimated 2.88 million tons, down from 2.97 million tons in August and 3.01 million tons in September 2018.
Get The News You Want
North American aluminum production reached 310,000 tons, down from 321,000 tons in August and flat compared with September 2018 production.
Get The News You Want
Asian production ex-China reached 363,000 tons, down from 374,000 tons in August and 364,000 tons in September 2018.
Get The News You Want
GCC production totaled 456,000 tons, down from 469,000 tons in August but up from the 437,000 tons produced in September 2018.
Get The News You Want
Production in eastern and central Europe totaled 344,000, down from 356,000 tons, but up from the 332,000 tons produced in September 2018.
Get The News You Want
Western European production totaled 276,000 tons, down from 286,000 tons in August and the 312,000 tons produced in September 2018.
Get The News You Want
In terms of prices, LME three-month aluminum is down 2.86% over the last month, down to $1,731/mt.
Get The News You Want
Get The News You Want
“LME aluminum prices weakened in September, despite looking stronger early on in the month,” MetalMiner’s Belinda Fuller explained earlier this month. “Less robust manufacturing and economic indicators hurt some industrial metal prices this month, including aluminum. The stronger U.S. dollar also resulted in weaker prices.
Get The News You Want
“LME prices look close to possibly dropping below yet another critical price level, $1,700/mt, after clearly breaking the $1,800/mt support level since last month.”
Chinese aluminum prices have also been on the decline of late. SHFE primary cash aluminum recently fell to 13,960 CNY per ton, down from 14,280 CNY per ton a month ago, according to MetalMiner IndX data.
Get The News You Want
LME prices have picked up slightly in recent days, but not substantially. With Chinese production now posting monthly declines for two straight months, it remains to be seen if that supply-side activity will have a supportive impact on prices.
Get The News You Want
So far, that doesn’t seem to be the case.
Get The News You Want
Get The News You Want
Of course, the demand picture must also be figured into any industrial metal’s forecast. The IMF recently downgraded its 2019 global growth forecast to 3%, its lowest level since the financial crisis — an ill omen for demand of a wide range of goods, including industrial metals.
Get The News You Want
Automotive demand for aluminum — among other metals — is a large source of the metal’s overall demand. As the IMF’s World Economic Outlook released this month notes , a slowdown in No. 1 automotive market China has weighed on aluminum prices.
Get The News You Want
Referring to the period between February and August of this year, the IMF noted, “The price of aluminum fell by 6.6 percent because of overcapacity in China and weakening demand from the vehicle market there.”
Get The News You Want
by Fouad Egbaria
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.