LONDON: Aluminium prices sank to their lowest since January 2017 on Monday after data showed an upswing in exports from top producer China, fuelling worries about oversupply.
Copper and some other industrial metals, however, stabilised on the back of a US-Mexico deal that averted new tariffs and raised hopes of an agreement with China.
China exported 536,000 tonnes of unwrought aluminium in May, up 7.6pc from the previous month, while year-to-date shipments have climbed 12.4pc.
"Aluminium took a hit after we had higher Chinese exports and the recent drop in energy prices also undermined it," said Robin Bhar, head of metals research at Societe Generale in London.
Aluminium is the most energy-intensive base metal and Brent crude futures have shed about 10pc in the past two weeks.
"It's surprising, however, that we haven't seen as much European consumer buying coming out to support (aluminium) prices," Bhar added.
Three-month aluminium on the London Metal Exchange was down 0.5pc at $1,756 a tonne by 1020 GMT after touching $1,752.50, the weakest since Jan. 11, 2017.
US-MEXICO: The United States dropped its threat to impose tariffs on Mexico in a deal to combat illegal migration from Central America, helping to calm markets worried about the China-US trade war.
COPPER TRADE: The Mexico news gave a modest boost to LME copper, which rose 0.3pc to $5,820 a tonne, but gains were capped after data showed China's imports of the metal fell 10.9pc in May from the previous month.
"There was a slowdown in imports because there was a lot of supply in the Chinese spot market, and that resulted in the very low premium in the sense that there was no incentive for traders to import copper," said Helen Lau, analyst at Argonaut Securities in Hong Kong.
NYRSTAR SMELTER: LME lead jumped 1.9pc to $1,866 a tonne after Nyrstar said its Port Pirie smelter in Australia would not reopen until the end of June.
Last Thursday, lead touched a one-month high when Nyrstar said the smelter, one of the world's largest for primary lead, had an unexpected outage and was likely to reopen within days.
PRICES: LME nickel rose 0.4pc to $11,670 a tonne, zinc slipped 0.6pc to $2,469.50 and tin shed 0.3pc to $19,170.
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