Aluminum edges lower but clings to near 10-year high

LONDON — Aluminum eased on Tuesday on a stronger dollar, but prices remained close to 10-year highs as supply concerns sparked by a coup in Guinea added to production disruptions elsewhere.

The metal, used in automobiles and beverage cans, has been beset with supply disruptions across the world, raising concerns over availability.

“Aluminum has been boosted by the repeating news about supply issues, whether in China, Jamaica, Canada and now in Guinea,” said Commerzbank analyst Daniel Briesemann said, adding this would support prices in the short term.

Although no major mines have been disrupted, a coup in Guinea at the weekend sparked supply concerns as the West African nation is the biggest source of aluminum ore bauxite for top producer China.

Benchmark three-month aluminum on the London Metal Exchange shed 0.5% to $2,760 a ton by 1652 GMT. In the previous session it touched its highest since May 2011 at $2,782.

“We believe that prices are way too high and expect a correction in the remainder of the year,” Mr. Briesemann said.

On Tuesday, the dollar firmed against a basket of other currencies, making assets such as aluminum and copper priced in the greenback less attractive to global buyers.

CHINA TRADE: Chinese exports of unwrought aluminum and products were 490,286 tons in August, hitting their highest since March 2020 with a 24% year-on-year jump and up 4.5% from July, data from customs showed.

COPPER IMPORTS: Copper prices were sapped by data showing that imports to top consumer China declined 41% year-on-year in August to their lowest since June 2019 at 394,017 tons.

“We believe the decrease is due in part to the high basis for comparison, as China had imported record-high quantities of copper opportunistically in the summer months last year — presumably in excess of its needs,” Commerzbank analysts said.

High prices, too, were deterring buyers, they said.

OTHER PRICES: Copper fell 1.1% to $9,344 a ton; zinc rose 1.2% to $3,043; lead was down 0.1% to $2,272; tin shed 2.9% to $31,950; while nickel declined 0.5% to $19,550. —