METALS-Aluminium near 1-month high on tightening supply in China
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SINGAPORE, Jan 23 (Reuters) – London aluminum prices rose for a second session on Wednesday to trade near last session’s one-month high, underpinned by signs of falling production in China.
Copper ticked higher after closing lower in the last two sessions, although concerns over trade dispute between Washington and Beijing kept a lid on prices of industrial metals.
“Aluminum bucked the trend…,” ANZ said in a note. “Canceled warrants (orders to withdraw from LME warehouses) rose 14 percent, the most since July. Supply-side issues appear to be tightening the market, despite the U.S. sanctions on Rusal being lifted.”
ALUMINIUM: Three-month aluminum on the London Metal Exchange rose 0.4 percent to $1,890 a tonne by 0409 GMT after climbing to its highest since Dec. 27 at $1,896.50 a tonne on Tuesday. Shanghai aluminum gained 0.5 percent to 13,500 yuan ($1,988.80) per tonne.
SMELTING: Nearly three million tonnes of Chinese aluminum smelting capacity has closed and inventories are drawing on a counter-seasonal basis, Deutsche Bank metals strategist Nick Snowdon said.
CAPACITY: China’s aluminum producers are set to cut at least another 800,000 tonnes per year of smelting capacity in coming months, an official at industry body China Nonferrous Metals Industry Association said in December.
DISPUTE: But base metals prices are likely to be capped by U.S.-China trade dispute.
COPPER: LME copper added 0.5 percent to $5,966.50 a tonne, while the most-traded copper contract on the Shanghai Futures Exchange slid 0.2 percent to 47,550 yuan a tonne.
POSITION: As much as U.S. President Donald Trump wants to boost markets through a trade pact with China, he will not soften his position that Beijing must make real structural reforms, including how it handles intellectual property, to reach a deal, advisers say.
TALKS: Offering to buy more American goods is unlikely by itself to overcome an issue that has bedeviled talks between the two countries. Those talks are set to continue when Chinese Vice Premier Liu He visits Washington at the end of January.
PRICES
Three month LME copper
Most active ShFE copper
Three month LME aluminum
Most active ShFE aluminum
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin
ARBS ($1 = 6.7880 Chinese yuan )
(Reporting by Naveen Thukral; Editing by Shreejay Sinha)
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