LONDON: Aluminium prices touched the highest in over six weeks on Friday after China’s output of raw material alumina slumped last month, highlighting the risk of tight supply due to power shortages.
Three-month aluminium on the London Metal Exchange had climbed 2.8% to $2,742 a tonne by 1500 GMT, the strongest since Nov. 2.
China’s output of alumina, which is smelted to make aluminium, fell in November by 4.5% year-on-year to its lowest in 18 months, official data showed on Friday.
China aims to lower its carbon output by restricting the electricity consumption and production of power-intensive industries such as alumina refining and aluminium smelting. “Ali rallied on power issues, market speculating on the potential closure of smelters,” Marex broker Al Munro said in a note.
Investors have refocused on potential shortages of industrial metals after being distracted recently by whether the US Federal Reserve would tackle rising inflation with faster bond tapering and interest rate rises next year, an analyst said.
LME zinc dipped 0.3% to $3,411 a tonne, eroding gains of 4.6% a day earlier when it touched a two-month high after Nyrstar said it planned to shut its French plant due to high European power prices.
Shanghai zinc prices ended more than 4% higher on Friday after scaling an over one-month peak.
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