Metal Miner reported that the monthly Aluminium MMI clocked in at 93 in April, a drop of 1.1% from 94 in March. This index has been on an uneven decline since the beginning of 2013 matching its all time low, first reached in August 2012 and this month’s fall comes primarily from LME and Indian aluminium prices.
Global oversupply remains an issue. Although our friends at HARBOR Aluminium report that more primary aluminium output cuts are taking place in both China and in the rest of the world, translating into another downgrade of our output growth forecasts for this year and they now expect the global primary market to be practically balanced as long as such things as sliding power supply agreements continue between electricity providers and aluminium smelters producers continue to have less incentive to draw down supply.
The bigger macro concern is that aluminium demand is shrinking. Respective PMIs showed manufacturing activity growth in China and the US in March came below market expectations and along with the unemployment rate, demand contraction has worsened in Europe.
On the LME, the aluminium 3 month price closed the month at USD 1,910 per tonne after dropping 5.3%. A 4.6% drop on the LME left the cash price of primary aluminium at USD 1,881 per tonne. The Indian aluminium cash price fell 1.9%. The prices of European 5083 plate and European 1050 aluminium both dropped slightly as well.
After dropping the previous month, the price of Chinese aluminium scrap prices rose 2.2%. The price of Chinese aluminium billet rose 0.3% after falling the previous month. The Chinese aluminium cash price prices rose 0.3% also.
The price of Korean 3003 coil premium over 1050 sheet held steady. Korean 5052 coil premium over 1050 sheet remained unchanged. Chinese aluminium bar did not budge the entire month. Last month was consistent for Korean 1050 aluminium sheet too.
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