A Why is it that aluminum prices continue to be pigeonholed at 90 cents for as long as memory can either serve or fail me? We are brainwashed into thinking that it will stay that way for-eeeeever! How we wish that same thing can be applied to gasoline or beef or corn as a commodity!!?? Of course, we wish, too.!
Granted, a vast majority of you readers probably had no clue how much higher other metals like copper, molybdenum (used to be mixed with steel for high tensile strength like tools), nickel ( there is such a metal called nickel in case you don't know... ), silver, gold, you name it .. had gone up in prices in recent years or past decade? Yes they went up 300-1000% and stayed there..
Aluminum somehow stayed stuck at same price for past... ( let me remember how long, oh yes, something like 40 years!!) it has been that Looooooooooooooooooong!! since !!!
Of course, aerospace is one of the first things that probably come to your mind when you hear aluminum being mentioned or is it still your creaking patio furniture still lying around since the 1960's. Why they made it sooo thin that it collapsed if you sort of fell on it.. It is so ridiculous! Or is it the skin of those so called tin homes known as trailers?
Anyway, there is zillions of new uses for aluminum since the days of patio furniture of the 1960's. Lets take heat sinks that you often see in the guts of your desktop computer cases. We also ride in aluminum framed bicycles now. Even aluminum windows are making another comeback as wood/aluminum clad designs with the wooden side facing inside and the aluminum side facing outside to enhance the durability of wooden windows favored by the upper class clientele.
As matter of factly, aluminum consumption is fast growing in popularity . Prices are supposed to be "elevated" as demand grows, but it is never the case for aluminum . Somehow, China decided to flood the world with aluminum that it doesn't know what to do with except to please anybody except aluminum stakeholders.
Now, we are drowning in millions of tons of excess aluminum being placed in sprawling warehouses that dot around the globe. yes, we believe in aluminum as the miracle metal as long as we can get it for dirt cheap! Is this what it is all about?
Is aluminum prices being manipulated by wanton overproduction with no regards toward the horrible environmental damage through heavy electricity consumption that is required to overproduce it. Where were the environmentalists when we needed them? Carbon dioxide has just passed 4% in our atmospheric peck order , still a long way behind oxygen (possibly falling from normal 21%- it must be around 19% by now , isn't it? )
Aluminum speculators are still happy to hoard those millions of tons in the warehouses with full conviction that prices for them are a foiled up joke for so long!
Disclosure: The author is long AA.
Additional disclosure: it is against my better judgment about this disclosure as I am presently under influence of the Wall Street voodoo therapy.