LME aluminum

Kobe Steel Ltd., a supplier of aluminum sheet to half of the Japan’s auto industry, is considering building a ¥100 billion plant in the US to expand sales to Japanese automakers operating in North America.

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The prize is an expected tenfold increase in demand for aluminum sheet here in the US, where stricter fuel economy standards have ignited a race among automakers to save weight and boost the efficiency of new models, driving up demand for the lightweight metal.

 

The London Metal Exchange today said it is taking further steps to improve operations at its warehouses, as changes introduced on Feb. 1 have had little impact on aluminum warehouse bottlenecks for physical delivery.

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Large queues have built up at some of the warehouses dotted around the world that are operated under the LME’s rules. That has caused financial pain, but also operational inconvenience to companies that use aluminum.

 

Red Brick Brewing will offer its beer in Novelis‘ new certified 90% recycled content evercan aluminum cans in the US.

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Novelis and Red Brick have come up with a closed-loop recycling system for the brewery’s used beverage cans. The cans from the brewery will be returned to a nearby Novelis recycling center, where these will be recycled into new evercan sheet.

 

Aluminum physical delivery premiums finally started to fall this week. MetalMiner’s Stuart Burns wrote that speculation is ongoing as to what is behind greater availability but most attribute it to a combination of slow demand in Europe, rising exports from China and traders/funds being unable to roll material over in financing deals due to the flat forward curve on the London Metal Exchange.

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The aluminum 3-month price closed last week at $1,801 per metric ton, after a 1.0% drop on the LME. Following a 0.8% drop on the LME, the primary aluminum cash price finished the week at $1,784 per metric ton.

 

Non-Chinese aluminum production was unchanged in January, according to the latest figures from the International Aluminum Institute (IAI).

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Producers are still holding aluminum capacity line in terms of keeping smelters offline in the face of low prices and historical stocks overhang, Reuters’ Andy Home wrote.

Their continued discipline is a subject of much market conjecture, Home said.

 

Aluminum producer UC Rusal PLC said Wednesday it swung to a net profit last year thanks to a recovery in the metal’s price and a slide in the ruble’s value that helped boost its profit margins.

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The Russian aluminum giant, which is listed in Hong Kong, said its net profit for 2014 was $293 million, a sharp recovery from a net loss of $3.32 billion in 2013. Rusal’s improved earnings came despite a 4.1% fall in revenue and a 6.6% drop in its aluminum output to 256,000 tons last year. That beat even the most positive expectations.

The company said “stringent” cost control and its decision to shut down inefficient smelters helped it return to profitability. Rusal’s earnings before interest, tax, depreciation and amortization surged to $1.5 billion compared with $870 million in 2013. Chief Executive Vladislav Soloviev told the Wall Street Journal the company “has no plans to restart any mothballed aluminum capacity.”

 

Russian aluminum producer UC Rusal‘s fourth-quarter core profit is expected to rise sharply because of a slump in the ruble against the dollar, a Reuters poll of seven banks showed. The earnings, to be published on Wednesday, are forecast to rise six times year-on-year and increase 36% compared with the previous quarter.

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Rusal has a primary listing in Hong Kong and secondary listings in Paris and Moscow. Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) are forecast to rise to $637 million in the October-December quarter, according to the average forecast in the survey.

 

Premiums for aluminum in Asia are set to slip from record highs as China ramps up exports of semi-manufactured products, leaving regional producers searching for buyers for their surplus metal.

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Premiums, the surcharge for obtaining physical metal, have nearly doubled in the past two years outside of China after Western producers cut supply due to years of low prices.

 

Premiums for aluminum in Asia are set to slip from record highs as China ramps up exports of semi-manufactured products, leaving regional producers searching for buyers for their surplus metal.

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Premiums, the surcharge for obtaining physical metal, have nearly doubled in the past two years outside of China after Western producers cut supply due to years of low prices.

 

US drink can and jar maker Ball Corp. agreed to buy British rival Rexam Plc in a sweetened 4.43 billion pounds ($6.85 billion) deal, creating an industry giant that can better manage capital spending and costs as aluminum premiums rise.

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The cash-and-stock deal would combine the world’s two largest beverage can makers by volume, making the combined entity the go-to supplier for many customers looking at single contracts across markets.