Aluminium Market Maintains Momentum Despite Supply Concerns
China's aluminium market has maintained its momentum as domestic inventories declined and prices gained nearly 8% so far this year. Aluminium production in China reached a record high of 4 million tonnes in August, with output increasing by 4.7% compared to the same period last year. This surge in production could potentially surpass the country's long-standing aluminium capacity ceiling of 45 million tonnes annually.
The decline in domestic inventories has been seen as a positive factor for aluminium prices. However, China's high aluminium production and the entry of a new alumina project in Guangxi into trial production may weigh on prices. The benchmark three-month aluminium price stood at around RMB 24,193.33 (USD 3606.88) per tonne on September 17.
In other base metals, lead and zinc supply is expected to increase following the resumption of production at Fankou Lead-Zinc Mine on September 17. Copper prices may face mixed signals due to increased production in Peru and India's anti-dumping measures against Chinese copper cables.