BY ONOME AMUGE
Aluminium prices fell to four-month lows and further fuelled demand concerns following a slowdown in manufacturing activities in the United States, the Euro Zone and particularly in top consumer China, where factory activities in April shrank to its sharpest fall in 26 months.
Benchmark aluminium on the London Metal Exchange (LME) slid 1.6 percent at $2,868 a tonne in official rings, with the lightweight metal slipping to its sixth consecutive weekly loss.
Prior to settling at the current bearish valuation, the metal used widely in the power, construction and packaging industries, had earlier touched $2,888 a tonne, losing about 30 percent since early March and the lowest since Jan. 6, 2022.
Tom Mulqueen, analyst at Amalgamated Metal Trading Ltd. (AMT), explained that concerns about growth and demand headwinds from China’s ongoing COVID lockdowns is a primary driver of the selling pressure in aluminium and other base metals.
Mulqueen added that slowing global manufacturing growth, Fed rate hikes and broader inflationary pressure on economic activity also weighed on prices.
Meanwhile, market dealers noted that copper stocks in LME registered warehouses, which stood at 170,025, have nearly tripled over the past couple of months and are at their highest since October 2021.
This, they said, has weighed on copper prices, which are hovering near their lowest since last December, with prices of the red metal down 0.2 percent at $9,467 a tonne.
It was down 0.7 percent at $9,424 a tonne.
Other base metals also fell into bearish positions as zinc lost 2.1 percent at $3,824 a tonne, lead ceded 1.4 percent to $2,246 a tonne, tin was down 1.5 percent to $39,900 a tonne, while nickel slipped 0.3 percent to $30,025 a tonne.