Aluminium hits lowest level in a month, copper climbs
30 Dec,2020
Aluminium prices fell to their lowest level in a month on Tuesday as investors worried that rising production would add to surpluses, while copper rose on hopes a U.S. aid package would boost economic activity.
Three-month aluminium on the London Metal Exchange fell 1.3% to $2,004 a tonne in official trading after touching $1,982, its lowest level since Nov. 27.
Global primary aluminium output climbed 4.1% year on year, data showed last week, while the daily production figure increased to the second-highest level on record, according to Capital Economics.
"With aluminium, you can't argue that the metal is in short supply. There are production increases pretty much across the board and new capacity is being energised," said independent consultant Robin Bhar.
"You may be getting some RV (relative value) trades coming through, long copper and short ali being placed ahead of the new year."
Other investors were likely adjusting their portfolios ahead of the end of the year, he added.
In China, aluminium prices on the Shanghai Futures Exchange dropped as much as 2.9% to 15,295 yuan ($2,341.01) a tonne, the lowest in nearly six weeks.
The decline follows a broader sell-off in Chinese equities as investors booked profits before the year-end after a rally driven by hopes for a stellar economic recovery.
