Aluminum prices are set to increase as producers refrain from adding capacity and demand rises, said Norsk Hydro ASA (NHY)’s outgoing chief executive officer.
“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 in London with Bloomberg News 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.”
With a 1.2 percent increase over the past day, the cash price of primary aluminum was the biggest mover on the LME, closing at $2,002 per metric ton on Wednesday, August 6. After a 0.5 percent increase, the 3-month price of aluminum finished the day on the LME at $2,013 per metric ton. The cash price of primary Indian aluminum declined 0.3 percent to INR 123.20 ($2.02) per kilogram.
Chinese aluminum closed mixed on Wednesday. The Chinese aluminum cash price gained 0.2 percent, closing at CNY 13,960 ($2,262) per metric ton. The price of Chinese aluminum scrap saw little movement at CNY 12,250 ($1,985) per metric ton. The price of Chinese aluminum billet saw essentially no change for the fifth day in a row, remaining around CNY 13,590 ($2,202) per metric ton. For the fifth day in a row, the price of Chinese aluminum bar remained essentially flat at CNY 14,200 ($2,301) per metric ton.