LONDON: Aluminium hit a 2-1/2 year peak above $2,000 a tonne on Tuesday, lifted by growing concerns over supply cuts in top producer China and an upbeat assessment of China's demand growth prospects.
China's Shandong province has ordered 3.21 million tonnes of smelting capacity to be shut, more than previously expected, as Beijing intensifies efforts to curb pollution in its bloated heavy industries.
China earlier this year ordered steel and aluminium producers in 28 cities to slash output during winter as it fights smog. Last week, the key steel producing area of Tangshan and other parts of Hebei province said they will implement the order.
"It's enough for the market to understand that in the second half of 2017 we could see a more serious approach to capacity cuts than we had in the first," said Hamza Khan, analyst at ING.
"We think continued infrastructure build-out in China is going to support demand," he added.
LME ALUMINIUM: Three-month London Metal Exchange aluminium traded up 1.4 percent at $1,992 a tonne in official midday rings, having earlier hit $2,007, the highest since December 2014.
"China's new 'Environmental Protection Tax Law' is due to come in on 1 January next year. The move marks a structural change in China policy and tolerance towards polluting industries and is likely to result in marked price rises for many metals," said SP Angel in a note.
ALUMINIUM EXPORTS: China exported 440,000 tonnes of unwrought aluminium and aluminium products in July, customs said, down 4.3 percent from June but up 12.8 percent from July last year, according to Reuters calculations.
WIDER MARKETS: Global stocks hit a new all-time high, shrugging off weaker-than-expected Chinese trade data that clouded an otherwise bright outlook for global growth.
STEEL: Chinese steel futures dropped marginally after a seven-day rally that lifted prices to the highest level since 2013 on expectations of reduced supply in the winter due to Beijing-imposed capacity curbs.
ZINC PRICES: Zinc, used mainly to galvanise steel, benefitted from strong Chinese steel prices. It was last bid up 0.8 percent in rings at $2,881, having earlier hit $2,888.50, near its highest since March.
COPPER IMPORTS: China's copper imports rose 8 percent in July from last year as the availability of credit improved, even as concerns lingered about manufacturing activity.
COPPER PRICE: Copper traded down 0.3 percent in rings at $6,394 after soaring to a two-year peak of $6,447.50 in the previous session.
OTHER METALS: Tin traded down 0.7 percent in rings at $20,455, nickel was last bid down 0.9 percent at $10,310, while lead traded up 0.3 percent at $2,367.
Comments
Comments are closed for this article.