Aluminium extends gains to six-week peak; copper firms on trade hopes

• Copper prices, meanwhile, were boosted by hopes of resolution to the protracted trade conflict between the United States and China.
• Aluminium stocks in LME-registered warehouses fell to 788,475 tonnes, their lowest in more than a month.
• Malaysia will issue mining licences for aluminium raw material bauxite in December or January,

LONDON: Aluminium touched a six-week high on Monday as bearish investors covered positions, with outages and potential plant closures raising supply concerns.

Rio Tinto last week said its high energy costs make its Australian aluminium assets unsustainable and that it might cut output or shut its New Zealand aluminium smelter.

"A bit of short-covering drove that move higher on Friday, and it extended to today," said Julius Baer analyst Carsten Menke.

Benchmark aluminium on the London Metal Exchange (LME) touched its highest since Sept. 20 at $1,793 a tonne. By 1140 GMT it was virtually flat at $1,785 after climbing 1.8% on Friday.

Copper prices, meanwhile, were boosted by hopes of resolution to the protracted trade conflict between the United States and China.

LME copper edged up 0.4% to $5,872 a tonne after the world's two largest economies said they had made progress in talks.

ALUMINIUM POSITION: The net speculative short position for LME aluminium is expected to have fallen for a fourth consecutive session on Friday to levels last seen in mid-September, according to Marex Spectron estimates.

CHINA ALUMINIUM OUTPUT: China's September output slipped 1.6% year on year, hit by continuing outages at two smelters. The world's biggest producer now faces a struggle to register annual output growth.

INVENTORIES: Aluminium stocks in LME-registered warehouses fell to 788,475 tonnes, their lowest in more than a month.

SPREAD: LME cash aluminium flipped to a premium over the three-month contract - at $4.75 a tonne - for the first time since January, indicating tight nearby supplies.

ALUMINA PRICES: Prices for alumina, the main aluminium ingredient, have halved to $283 a tonne since last year's peak.

LME PRICES: LME aluminium is down 3.6% this year, touching a low of $1,704.85 a tonne in October, its weakest since January 2017.

M&A: Zijin Mining, one of China's biggest gold producers, on Monday said it would buy partner Freeport McMoran Inc's copper-gold assets in Serbia for up to $390 million, raising its copper resources by 16%.

BAUXITE: Malaysia will issue mining licences for aluminium raw material bauxite in December or January, a minister said, marking a resumption in activity after a ban imposed in 2016 over unregulated mining and water contamination.

LME PRICES: LME nickel fell 1% to $16,610 a tonne, zinc rose 0.5% to $2,532 and lead eased by 0.1% to $2,161 and tin was down 0.4% at $16,465.