Aluminum fell the most in two months on concern more exports from China of products made from the metal will exacerbate a global glut.
China plans to scrap a 15 percent export tax on rods and strips made from primary aluminum effective May 1. The move may send world prices lower amid ample supplies in the Asian nation, according to Bloomberg Intelligence.
“China is going to ensure it can support its aluminum sector,” David Wilson, an analyst at Citigroup Inc. in London, said in a telephone interview. “It’s going to keep the market in oversupply. As long as they are still making a margin, they will continue to export, which is not positive for prices.”
Aluminum for delivery in three months fell 1.6 percent to settle at $1,777.50 a metric ton at 5:50 p.m. on the London Metal Exchange, the biggest drop since Feb. 10. Earlier, the price touched $1,769, the lowest since April 14.
HSBC Holdings Plc and Markit Economics’ preliminary Purchasing Managers’ Index for manufacturing fell in April to a 12-month low in China, the world’s biggest consumer of industrial metals.
Copper for delivery in three months rose 0.5 percent to $5,940 a ton ($2.69 a pound) in London. Lead, tin and zinc fell, while nickel climbed.
On the Comex in New York, copper futures for July delivery advanced 0.9 percent to $2.702 a pound.