“This could translate to a 100,000-tonne annual aluminum output reduction,” CRU analyst Wan Ling told Reuters.
Aluminum for delivery in June was down 1.27% on Tuesday, after futures touched $2.245 a tonne on the Comex market in New York.
The most-traded April aluminum contract on the Shanghai Futures Exchange climbed as much as 2.6% to 17,980 yuan ($2,766.15) a tonne, a level unseen since August 2011, before easing to close up 0.6% at 17,630 yuan a tonne.
The three-month aluminum on the London Metal Exchange advanced as much as 0.4% to $2,227 a tonne.
[Click here for interactive aluminum price chart]
Emirates Global Aluminium PJSC, one of the world’s biggest producers of the metal, said it expects prices to remain elevated this year as the global economy recovers from the coronavirus pandemic and vaccine rollouts continue.
Positive market sentiment from late 2020 “carried over to this year and continues to give us a strong outlook for 2021,” Chief Executive Officer Abdulnasser bin Kalban told Bloomberg.
“Figures released by the National Bureau of Statistics pointed to strong aluminum production in China over the first two months,” ING analysts said, referring to an 8.4% annual rise in China’s aluminum output in the first two months of 2021.
“However, investors appear to be more forward-looking, and instead focused on the ongoing production curtailments in Inner Mongolia,” they added.
Aluminum inventories in LME warehouses were hovering around their highest since March 2017, while stockpiles in SHFE warehouses hit a high unseen since April 2020 last week.
($1 = 6.5000 yuan)
(With files from Reuters and Bloomberg)
