Aluminum prices are set to increase as producers refrain from adding capacity and demand rises, said Norwegian aluminum manufacturer Norsk Hydro ASA’s outgoing chief executive officer in a report by Bloomberg News.
“There’s a completely new situation today compared to what it was just a few years ago, with a tremendous oversupply of aluminum,” Svein Richard Brandtzaeg said in an interview with Bloomberg in London yesterday. “If you look at the situation now, there’s a clear increasing deficit, and if you look at supply-demand balance outside China today, the deficit is about 1 million tons of aluminum.”
Norsk Hydro, which cut about 30 percent of its production after the global financial crisis in 2008, will hold off from restarting output of primary aluminum, the raw form of the metal, until the market becomes more stable, he said.
The cash price of primary Indian aluminum saw the biggest increase at 2.4 percent, finishing at INR 122.55 ($2.03) per kilogram for Tuesday, July 22. After a 1.5 percent increase, the primary aluminum cash price finished the day on the LME at $1,987 per metric ton. On the LME, the 3-month price of aluminum rose 1.4 percent to $2,006 per metric ton.
Chinese aluminum prices were flat for the day. For the fifth consecutive day, the price of Chinese aluminum scrap held flat at CNY 12,250 ($1,973) per metric ton. For the fifth day in a row, the price of Chinese aluminum billet remained essentially flat at CNY 13,590 ($2,189) per metric ton. The price of Chinese aluminum bar continues hovering around CNY 14,200 ($2,287) per metric ton for the fifth day in a row. The Chinese aluminum cash price saw little movement at CNY 13,450 ($2,166) per metric ton.