Quarterly Aluminum Price Outlook: Could Premiums Keep Pushing?

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 |  Includes: FOIL
by: MetalMiner

By Taras Berezowsky


(Click to enlarge)

The monthly Aluminum MMI® (much like its base-metal cousin, our monthly copper price index) registered a value of 93 in October, an increase of 1.1 percent from 92 in September.

Most global transactional prices on the index rose, in China, India, Europe and Korea – but the LME aluminum price kept the overall index increase rather muted.

The main reason for increase, however, does circle back to the issues surrounding the London Metal Exchange. “Uncertainty over the effect changes in LME warehouse load-out rates had a supportive effect on prices,” said Stuart Burns, co-founder and contributing editor of MetalMiner. “The market remains over-supplied, but the stock and finance model is alive and kicking, which is supported by strong forward premiums on the LME.”

Aluminum Price Outlook

Based on MetalMiner data and what else we’re seeing in the markets, there’s little reason to see a negative turn. “In view of the LME situation and solid premiums, prices could rise further during the quarter,” Burns noted.

Breakdown: Price Drivers of Aluminum Index Rise

A 5.3 percent increase for the Indian aluminum cash price left it higher for the month. The cash price of Chinese aluminum increased 2.1 percent. After dropping the previous month, the price of Chinese aluminum scrap prices rose 1.5 percent.

The price of Chinese aluminum billet finished the month 1.5 percent higher. This was the third straight month of increases.

The prices of European 5083 plate and European 1050 aluminum both increased. Korean 3003 coil premium over 1050 sheet, Korean 5052 coil premium over 1050 sheet, and Korean 1050 aluminum sheet also all increased for October’s reading.

The LME aluminum 3-month price closed the month down 1.6 percent at $1,849 per metric ton.

The Aluminum MMI® collects and weights 12 global aluminum price points to provide a unique view into aluminum price trends over a 30-day period. For more information on the Aluminum MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.