Aluminium jumps to highest since 2008 on supply fears

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Feb 10 (Reuters) – Base metals advanced on Thursday, with benchmark aluminium scaling a fresh peak in more than 13 years in London, while Shanghai prices hit their highest in nearly four months as smelter closures fuelled concern over dwindling inventories.

Three-month aluminium on the London Metal Exchange was up 0.3% at $3,276.50 a tonne, as of 0734 GMT, after touching $3,282 during Asian trading, its loftiest since July 2008.

The most-traded March aluminium contract on the Shanghai Futures Exchange ended daytime trading 2.1% higher at 23,290 yuan ($3,664.66) a tonne. It rose to as high as 23,415 yuan, its highest since Oct. 21.

“Signs of tightness across the base metal sector continue to persist,” ANZ senior commodity strategists said in a note. “It should come as no surprise that all the major industrial metals traded on the LME are currently in backwardation.”

Shanghai copper climbed 4% to 73,030 yuan a tonne, after earlier hitting 73,040 yuan, also its highest since Oct. 21.

LME copper rose 0.8% to $10,140 a tonne.

“Copper held on major exchanges is now at alarming levels, representing just three days of global supply,” the ANZ strategists said.


* While aluminium production in the Chinese city of Baise, which has gone into lockdown after recent COVID-19 outbreaks, remains stable, mobility restrictions have hampered transportation of raw materials and aluminium ingots.

* Smelter shutdowns in China, the world’s top producer of the metal used in packaging and transport, and in Europe due to high energy costs have dampened aluminium output.

* Aluminium stocks in LME-registered warehouses have fallen to 761,950 tonnes, the lowest since 2007 and down from almost 2 million tonnes last March.

* Inventories in Shanghai exchange warehouses were down 17.5% this year to 266,906 tonnes.

* A tech-fuelled global stocks rally cooled in Asian trade on Thursday as cautious investors awaited the release of U.S. inflation data later in the day for fresh clues about the pace of the Federal Reserve’s monetary policy tightening.

* Shanghai zinc rose 2.4% to 25,775 yuan a tonne, nickel added 2.2% to 173,890 yuan, lead gained 2.1% to 15,230 yuan, and tin climbed 2.2% to 338,380 yuan.

* LME zinc gained 1.2% to $3,689 a tonne, nickel advanced 1% to $23,425, lead climbed 1.3% to $2,273, while tin jumped 1.3% to $43,660.

($1 = 6.3553 Chinese yuan)

(Reporting by Enrico Dela Cruz in Manila; Editing by Subhranshu Sahu and Sherry Jacob-Phillips)

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