Force majeure pressure on Monday drove aluminium prices to a new six-year peak as the dollar fell after Rio Tinto made declarations on some of its customer contracts following US sanctions on its partner Rusal, according to a news service report monitored by businessamlive.
The benchmark on the London Metal Exchange rose 2.7 percent to $2,347 per tonne in official rings.
Prices earlier touched their highest since March 2012 at $2,366.50.
According to Eugen Weinberg, Commerzbank head of commodities research, Aluminium would keep gaining on likely forced majeures declaration by other traders since Russia’s Rusal was one of the world’s largest producers.
Rio Tinto also said it was reviewing Rusal’s 20 percent stake in the Queensland Alumina refinery, Rusal’s supply and offtake arrangements, bauxite sales to Rusal’s refinery in Ireland and offtake contracts for alumina.
Rio supplies Aughinish Alumina with bauxite, which is then turned into alumina. While sources said that Aughinish Alumina, Europe’s largest alumina refinery, which was acquired by Rusal in 2007, has enough bauxite to last until the end of June, Rio’s decision has added to concerns over the future of the operation on the Shannon estuary.
Taoiseach Leo Varadkar on Friday held a private meeting with management of the Russian-owned alumina producing plant in Askeaton, Co Limerick, as “concern” mounted over the plant’s continued operations, and the future of its 450 employees.