Aluminum prices have reached a 13-year high due to a combination of supply constraints and rising demand.
The price of aluminum climbed as much as 2.6% to $3,000 U.S. a ton, the highest intraday level since 2008, on the London Metal Exchange. In China, the metal surged as much as 5.4% to 23,790 yuan, the highest level since 2006. Other base metals were mainly lower, with copper trading down 0.3% in London and nickel losing 2.6%.
The price of aluminum has surged more than 15% over the past three weeks as supply risks rise throughout the industry, from bauxite mining in Guinea and refining in Jamaica to smelting in China.
Chinese aluminum producers were dealt a blow as Steelhome reported that Yunnan province will enforce production curbs on aluminum from this month in an effort to meet energy intensity reduction goals. Smelters in the European Union are also facing rising costs with both carbon credits and power inputs at record highs.
Aluminum Corp. of China Ltd., the country’s largest smelter, surged as much as 12% in Hong Kong trading Monday (September 13).
Snarled supplies are likely to hinder the industry through the rest of this year and most of 2022, with some analysts projecting it could take as long as five years to resolve the issues. The energy-intensive metal has risen by around two-thirds over the past year.
