Spot aluminum prices on the European market traded slightly lower last week as worries over Brexit and its impact on future demand influenced buyers.
Wrote Donald Levit of Economic Calendar: “While there is not expected to be a huge shift in aluminum demand as the U.K. slowly decouples itself from the European Union, a general air of uncertainty is pressuring the sentiment around aluminum demand and prices are responding by dropping slightly.”
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Levit added that Brexit is not expected to have a sudden impact on demand for aluminum but prices for the metal could fluctuate as the result of currency valuations. Forecasts currently call for a depreciation of the pound, but other factors stemming from Brexit — including slow economic growth and lagging U.K. vehicle sales — could team up to put further pressure on aluminum prices.
Meanwhile, in China…
MetalMiner reported that Chinese aluminum output has recovered, following a price rebound with a run up in Shanghai aluminum prices spurring an increase in Chinese aluminum production and exports in recent months.
We encourage North American manufacturers, especially those that source internationally, to keep a close eye on the Brexit fallout as it will sure to have a major impact on metal prices, including aluminum in the months to come.
You can find a more in-depth aluminum price forecast and outlook in our brand new Monthly Metal Buying Outlook report. Check it out to receive short- and long-term buying strategies with specific price thresholds.
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