Premier eFinance: Aluminium prices expected to remain stable for 2011.

Industry specialists and delegates attending a recent aluminium conference held in Chicago expect stable to higher prices and premiums.
June 22, 2011 - PRLog -- Subjects addressed at Harbor Intelligence’s Annual Aluminum Outlook Conference included Improving demand helped by the auto and commercial aircraft sectors and the substitution of aluminium with more expensive copper. The U.S. currently has an aluminium–market deficit, which is likely to boost the widely followed Midwest premium, a Harbor analyst told Premier eFinance.

A survey of the more than 200 delegates attending the conference showed that 75% expect relatively stable London Metal Exchange prices averaging $2,400 to $2,600 a metric ton in 2012. Fifty-eight percent anticipated that the regional premium they pay would increase next year.

Founder and manager of Harbor Intelligence, Jorge Vazquez, was more optimistic, saying he is expecting a three-year uptrend with prices “north of $3,000 from 2012 on.” This translates to around $1.35 a pound.

Chinese production will fill a large portion of any global aluminum output gap, but support nonetheless will come from a lack of cheap energy and environmental and political issues, including the time it takes to build a smelter in Western nations, Vazquez told Premier eFinance.

Vazquez went on to say that aluminum demand has reached new highs and an internal deficit in the key commodity-consuming nation of China is widening. Visible inventories in the country more than halved in last year, while consumers/traders heavily de-stocked at least 3.5 million metric tons up to June. In theory, China could become a net importer of aluminum, even though ten fully committed, verified expansion projects are coming in the next 18 months, Vazquez said.

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