Fundamental updates by Solid ECN

SOLIDECN

Master Trader
Nov 16, 2021
3,086
22
54
39

Aluminum Soar to New Highs Amid Supply Challenges in China​

Solid ECN – Aluminum prices climbed above $2,270 per tonne, reaching their peak since January 31st. This jump was fueled by encouraging reports from China, sparking expectations of increased demand. In the first two months of 2024, China's industrial activities expanded by 7% compared to the previous year, beating the predicted 5%. This growth was reflected in primary aluminum production, which rose by 5.5%, driven by high prices that encouraged more production.

Additionally, China saw a significant boost in its imports of unwrought aluminum and related products, with figures skyrocketing by 93.6% to 720,000 tons compared to the same timeframe last year. In line with this, aluminum stocks in SHFE-monitored warehouses saw a substantial increase of around 80% in February alone.

However, production faced hurdles in Yunnan, one of China's top aluminum-producing areas, due to ongoing production restrictions linked to the annual dry season. Despite these challenges, production will pick up once power supply issues are resolved. Yet, the output growth might be held back by the limited boost in power availability and the planned maintenance at several smelters.​
 

SOLIDECN

Master Trader
Nov 16, 2021
3,086
22
54
39

Rising Russian Crude Oil Prices and Global Impacts​

Solid ECN – Russian Urals crude oil prices have recently climbed above $77 a barrel, approaching the high levels seen in October, and are following the general upward trend of global oil prices. Meanwhile, China is on track to bring in a historically high volume of Russian oil this month, although the quantity heading to India has fallen, as reported by Bloomberg.

Despite being targeted by recent attacks, Russia aims to increase its oil exports via western ports, thanks to extra shipments from companies like Rosneft and Tatneft. In December 2022, a price limit of $60 per barrel was set on Russian oil by the European Union, the G7 nations, and Australia. This measure aims to cut down the funding Russia receives for military operations in Ukraine.​