Aluminum extends price fall on US sanctions relief

LONDON — Aluminum hit its lowest in nearly two weeks on Tuesday, extending declines from the previous day after Washington gave US companies more time to comply with sanctions on Russian producer Rusal and hinted at further sanctions relief.

The US Treasury department gave Americans until Oct. 23, instead of June 5, to wind down business with Rusal and said it would consider lifting sanctions if Russian tycoon Oleg Deripaska ceded control of the company.

“We should be getting used to the fact that Trump has a lot of bark and less bite. We’ve seen it with a lot of policies. He introduces them, markets react, then he backtracks or nothing comes of it or they get delayed,” said William Adams, head of research at Fastmarkets.

“Aluminum is going to remain volatile depending on how the sanctions play out, but at the end of the day it will return to the range either side of $2,200 until we see evidence of stronger economic growth.”

Aluminum rallied to its highest since mid-2011 last week on fears that the global market could face shortages because of the sanctions on Rusal, a company that last year accounted for more than 6% of global aluminum output.

Three- month aluminum on the London Metal Exchange ended down three percent at $2,227 a ton, having touched $2,200, its lowest since April 11. The price had dropped by 7.1% on Monday, marking in its biggest one- day decline in eight years.

Consumption of aluminum in China, the world’s top user, will increase by 7- 9% this year and next, an executive at Aluminum Corp. of China (Chalco) said.

Nickel closed down 1.9% at $13,990 a ton after a 3.8% fall on Monday. The metal hit a threeyear high on April 19 on fears that sanctions might be extended to major producer Nornickel, a company linked with both Rusal and Deripaska.

The Philippines’ top nickel ore producer, Nickel Asia Corp., said its 2018 export plans remain unchanged despite the government’s intention to limit mining areas.

The union at BHP’s Escondida copper mine in Chile, the world’s largest, said it had made little progress in reaching an early contract deal with the company’s management.

Cuba forecasts nickel plus cobalt sulfide production will exceed 50,000 tons this year even as prices rise.

Among other industrial metals, copper ended up 1% at $7,013 a ton, zinc ended down 0.50% at $3,212, lead ended down 0.40% at $2,310 and tin closed up 0.20% at $21,100. —