Aluminium prices hit over 10-year peak on Guinea bauxite worry

Aluminium prices hit a more than 10-year high on Monday, as a coup in major bauxite supplier Guinea raised fear of further supply disruption in the downstream market.

Guinea is the world's biggest supplier of bauxite, an ore used to produce aluminium, to top aluminium producer and consumer China.

Special forces soldiers appeared on Sunday to have ousted Guinea's long-serving president, telling the nation they had dissolved its government and constitution and closed its land and air borders.

The most-traded October aluminium contract on the Shanghai Futures Exchange jumped as much as 3.2% to 21,980 yuan ($3,405.64) a tonne, a level unseen since July 2008.

Three-month aluminium on the London Metal Exchange rose as much as 1.8% to $2,775.50 a tonne, highest since May 2011.

FUNDAMENTALS

• LME copper fell 0.2% to $9,410.50 a tonne, nickel declined 1.1% to $19,565 a tonne and tin shed 1% to $32,725 a tonne.

• ShFE copper edged up 0.2% to 69,260 yuan a tonne, nickel declined 0.5% to 145,540 yuan a tonne, zinc advanced 0.7% to 22,495 yuan a tonne and lead increased 0.4% to 15,085 yuan a tonne.

• A prolonged period of high aluminium prices created partly by output cuts in China is expected to encourage new capacity in other parts of the world, which will eventually weigh on LME prices trading at 10-year highs.

• Minera Lumina Copper said on Sunday that it had reached an agreement with workers at its Caserones mine in Chile on a three-year collective contract, ending an almost month-long strike.