Aluminium prices in London inched higher on Thursday, supported by falling warehouse inventories and improving demand, although gains were capped by uncertainties over the Omicron coronavirus variant and its economic impact.
Three-month aluminium on the London Metal Exchange rose 0.1% to $2,667 a tonne by 0145 GMT, while the most-traded January aluminium contract on the Shanghai Futures Exchange eased 0.2% to 18,960 yuan ($2,976.92) a tonne.
LME inventories of aluminium dropped to 893,775 tonnes, the lowest since September 2007 and down 55% from March. Most metals recently left warehouses in Malaysia, exchange data showed.
The premium of LME cash aluminium over the three-month contract rose to $16.30 a tonne, indicating tightness in nearby supplies.
Meanwhile, the first US case of the Omicron variant and prospects of sooner-than-expected interest rate hikes by the Federal Reserve kept investor sentiment bearish.
Top copper producer Codelco's chief executive expects copper prices to fall up to 12% in a year as supply will outpace demand until 2024. Only then will higher consumption from electric vehicles match up with output.
China's Zhejiang Huayou Cobalt said its Huayue nickel and cobalt high-pressure acid leach project in Indonesia has churned out its first batch of output for use in electric vehicles.
LME copper rose 0.1% to $9,449.50 a tonne, nickel advanced 0.9% to $20,130 a tonne and lead fell 0.4% to $2,293 a tonne.
ShFE copper dipped 0.5% to 69,180 yuan a tonne, while zinc rose 0.2% to 23,150 yuan a tonne.