Aluminum rose for a third day to match a one-month high as demand prospects improved amid advancing car sales and rising fuel costs. Zinc and lead gained.
Aluminum for delivery in three months increased as much as 0.4 percent to $2,151 a metric ton, the same as the intra-day high yesterday, and traded at $2,145.75 at 4:04 p.m. Seoul time on the London Metal Exchange. The $2,151 level was the highest since Jan. 3. Copper was little changed at $8,231.50 in London. Markets in China are closed for the Lunar New Year holiday.
Norsk Hydro ASA, Europe’s third-largest aluminum producer, forecast this week a balanced market this year with demand set to grow 2 percent to 4 percent outside China. United Co. Rusal, the world’s biggest producer, said last week global demand will climb 6 percent this year. China’s passenger vehicle sales reached a monthly record of 1.73 million units in January.
“The outlook for aluminum demand is improving on rising car sales and higher oil prices,” Lelia Kim, a metals trader at Seoul-based Tong Yang Securities Inc., said by phone today. “Base metals across the board are gaining today as many investors bet Chinese buying will resume after the holiday.”
Crude oil in New York has gained 5.7 percent this year. Futures for March delivery traded little changed at $97.09 a barrel after earlier rising as much as 0.3 percent.
Higher oil prices push up gasoline costs for drivers, encouraging automakers to use more aluminum to build lighter cars. Rising crude may also increase production costs for the metal itself, extending price gains, Kim said.
Global automobile sales exceeded 80 million for the first time in 2012 and will advance 2.4 percent to 82.7 million this year, according to LMC Automotive Ltd., a research company based in Oxford, England.
Copper for delivery in March was little changed at $3.7405 a pound on the Comex in New York. On the LME, tin and nickel increased.
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