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    CRU analyst forecasts a surplus market for primary aluminium in Q4 2019 and 2020

  • China Aluminium Network
  • Post Time: 2019/10/10
  • Click Amount: 112

    According to a CRU analyst,  Paul Williams, Head of Aluminium, aluminium market is moving into surplus as demand continues to weaken around the world. The LME 3-month price now stands at US$1744 per tonne after recent increase.  Prices have been affected by bad industrial data and an inflow of stocks onto the LME. About 100,000 tonne of stocks have been added to LME warehouses in the last 10 days. The increase in stock is driven by backwardation and weak demand in the market. Most of the stocks were destined to Johor, Singapore and Gwangyang.

    Falling primary aluminium demand is the main concern affecting the sector while semi-finished demands are stronger. Primary aluminium demand will fall globally in 2019 after 2009. The combination of the severe plunge in demand in the automotive sector, global trade tensions, and increased use of scrap is depressing global primary aluminium demand.

    Though demand is strong in the beverage can industry around the world. Can sheet utilizes a high portion of recycled aluminium in the product mix and does not consume much of primary aluminium.

    Demand slowdown outside China has intensified in recent months. It is expected that the slowing in the manufacturing and automotive sectors could start to flow through to construction markets in several regions. All these factors are indicating a market surplus in the fourth quarter and 2019 and a substantial surplus in Q1 2020, both in China and the rest of the world.

    Source: www.alcircle.com
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