Aluminium hits 11-week high on improved demand prospects

Aluminium prices climbed to an 11-week high on Thursday as buying interest increased with improving demand prospects from top consumer China.

Three-month aluminium on the London Metal Exchange (LME) CMAL3 touched $2,312 per metric ton earlier in the day, the highest since Jan. 4. It last traded 1.2%up at $2,301 per ton at 1121 GMT.

To consumer Chinaimported 720,000 tons of unwrought aluminium and products in the January-February this year, up 93.6% from the same period last year, customs data showed.

“Aluminium has been lagging behind its base metals peers, it is cheap. The latest Chinese import data is surprising and widely cited as a short-term driver,” a trader source said.
Brokerage Marex also saw an improving demand for LME aluminium.

“Money is coming in and we have seen evidence of that first in copper but more recently in aluminium,” said Alastair Munro, senior base metals strategist at Marex, anticipating more capital flows into underperforming commodity assets.

In other metals, LME lead CMPB3 was flat at $2,063.

LME lead stocks rose 34% on Wednesday to their highest in 11 years after massive arrivals of metal in warehouses in Singapore and South Korea.
Visibility of lead stocks has pushed the discount for the cash over the three-month contract MPB0-3 to above $50 a ton, its highest since June 1992.

Overall industrial metals prices are likely to be capped by a stronger dollar, which makes it costlier to buy the greenback-priced commodity.

The dollar index =USD strengthened on Thursday after Federal Reserve decided to keep key rates unchanged.

LME copper CMCU3 was up 0.7% to $8,991 a ton, nickel CMNI3 increased 0.3% to $17,540, zinc CMZN3 rose 1.3% to $2,541.5 and tin CMSN3 jumped 2% to $27,770.
Source: Reuters (Reporting by Julian Luk; Editing by Varun H K)