Aluminum Drops Most in Three Weeks as Industrial Metals FallBloomberg News
Aluminum in London declined by the most in three weeks as markets in Shanghai reopened after a week-long holiday amid expectations of growing supplies. Copper, zinc, lead, nickel and tin also fell.
Aluminum for delivery in three months fell as much as 1.2 percent to $2,143 a metric ton on the London Metal Exchange, the most since Jan. 25. The metal climbed to $2,174 on Feb. 15, the highest in six weeks and recorded a 2.3 percent weekly advance. Futures for delivery in May on the Shanghai Futures Exchange closed 0.7 percent lower at 15,140 yuan ($2,427) a ton.
“Expectations for further gains in aluminum production in China mean Shanghai prices are ignoring the gains in London last week,” said Fang Junfeng, an analyst at Shanghai CIFCO Futures Co. “While seasonal demand may increase after this holiday, it still will take a couple of weeks before that actually happens.”
China’s aluminum output gained 13 percent to a record 19.88 million tons last year, according to the statistics bureau. Production is likely to rise to 23.25 million tons this year on additions of low-cost smelters in the northwestern regions of the country and government subsidies to uneconomic smelters, Barclays Plc said in a report on Feb. 15. The bank, which forecast a global surplus of 1.8 million tons this year, said investors should consider taking short positions in the metal at current price levels.
Copper for delivery in three months on the LME fell 0.5 percent to $8,166 a ton as of 3:44 p.m. Shanghai time, while its counterpart in Shanghai closed 1.3 percent lower at 58,900 yuan a ton.
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