Aluminium rises on dwindling LME stocks

SINGAPORE: Aluminium prices rose on Monday as shrinking inventories in London Metal Exchange-registered warehouses signalled tight near-term supply despite sentiment being boosted by the Middle East peace talks.

Benchmark three-month aluminium on the London Metal Exchange was up 0.4% at $3,103 a metric ton by 0300 GMT.

The most-traded aluminium contract on the Shanghai Futures Exchange rose 0.77% to 22,835 yuan ($3,363.78) a ton.

Continued withdrawals last week at LME-registered warehouses brought total stocks to below 300,000 tons for the first time since 2022 on Friday.

Prices were also supported last week by more dovish interest rate signals after the US jobs data released on Thursday showed a sharp slowdown in the labour market.

Fears of US rate hikes later this year have weighed on industrial metal prices as they could dampen economic activity and demand.

However, gains were limited by the fading Middle East war risk premium and as announcements about smelter production restarts fuelled expectations of increasing supply.

Some analysts, though, say that supply will take longer than expected to reach the market.

Elsewhere, copper continued to hover at slightly higher prices.

Traders are still watching for news about a potential US tariff on imports of refined copper.

LME copper added 0.18%, while prices on the SHFE increased 0.17%.

Tariff concerns were a big driver of copper prices ahead of an expected recommendation from US Commerce Secretary Howard Lutnick to President Donald Trump due at the end of June, but there has been no news on that front.

In the meantime, copper stocks in LME-registered warehouses have continued to decrease, while stocks in Comex-registered warehouses have increased.

Among other LME metals, zinc dipped 0.11%, lead shed 0.24%, nickel lost 0.54% and tin added 0.38%.

Elsewhere on SHFE, zinc gained 0.8%, lead dipped 0.06%, nickel dipped 0.31% and tin rose 2.75%.