Friday, February 25, 2011

Aluminium prices to rebound above $3000 in 2011

Aluminium Chart

The price of Aluminium is expected to climb back above the 3,000 USD per tonne level by the end of the year 2011, as supplies tighten and demand recovers from its second-worst downturn on record. Demand is enormous, consumers are wealthy, and profitability is obvious: it seems a lot of companies should be rushing to enter the Aluminium sector, yet, the situation is not as simple as it may seem.
Aluminium represents the second largest metals market in the world. Aluminium production is highest in Asia that is 24 percent of world production. China is the world's one of the largest producer and consumer of the metal used widely in transport, construction and packaging.

Based on Aluminium Association surveys, U.S. primary aluminum production totaled 1,727,258 metric tons (tonnes) in 2010, a rise of 91 tonnes over the 2009 total of 1,727,167 tonnes. On LME-registered warehouses, total Aluminium deposits are currently at 4.6 million tonnes. Aluminum is lagging behind other base metals twisting in beginning of the year 2011. Global investment fund houses are focusing on white metals for coming year as earning high profitability for growth. The indication of recovery in the US economy is likely to raise base metals’ consumption, with increased focus on infrastructure and electrical sectors. I think prices have to move higher by year-end. I am optimistic about the longer-term demand prospects for Aluminium to cross all time high levels.