Morning Bites

🏭Global primary aluminium output rose 3.2% YoY in June, roughly in line with the revised +3.5% YoY in May, according to data from the International Aluminium Institute. Specifically, China’s production (59% of global Al output) rose 4.2% YoY, following improved power supply from the country's hydroelectric system, as well as smelters’ solidified margins. Although spot Al prices shrank 7% MoM to USD 2,330/t, amid the lack of new material economic support measures in China, Al is trading below its fundamentally reasonable level for 2024 (USD >2,500/t), on our numbers

Furthermore, China’s Al output is capped at 45mnt (vs. 43.5mnt annualised in 1H24), implying limited potential for additional supply growth

We reiterate our view that the strong consumption dynamics in China (incl. solid demand from the local new energy sector and grid), as well as the widely expected monetary easing in the US in 2024, could well add support to Al prices

#aluminium  
https://metals-wire.com/sector/Aluminium