Where will the LME Aluminium Price go next?

LME Markets Still in Trouble

The only way is up, they say. Well, with the LME, it seems to be the opposite.

Since the heady days of May 2018, when the price of Aluminium sat around $2300/t, it has slowly decreased to never before seen lows of today, where the LME is at $1432.50 (as of 18th May 3.54pm GMT+1).

Last week, LME Aluminum oscillated downwards, with an operating range of 1476-1496.5 USD / ton. Affected by the economic outage caused by the outbreak in April, the monthly rate of CPI in the United States dropped significantly in April.

On the other hand, on the 11th, Saudi Arabia announced a reduction in oil production, but the rate was still lower than
market expectations. Coupled with weak fundamentals, LME Aluminum’s center of gravity continued to move down slightly.

With further reductions in output by OPEC and other oil-producing nations, coupled with low-demand for oil, markets are bullish about the future of the world’s economy.

USD fluctuations against other currencies, may impact the power of the dollar to purchase material abroad, or even for other countries to buy in dollars for raw materials, such as those used in the Aluminium Industry.

Oil-based products for up and downstream factories are crucial, so we’re keeping an eye on future developments to see how this may impact smelters and producers of secondary materials.

Alumina prices ready to bounce back?

We’ve seen a small increase in Alumina prices of the past few days for Chinese domestic alumina, which gives breathing room for the smelters, but is it the sign of a return to more profitability?

We’re unsure whether the market can continue to rise, but we’re sure to report further about this in our next Aluminium Monthly Report.

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