Aluminum Prices Stabilize Amid Changing Market Dynamics

The Aluminum Monthly Metals Index (MMI) posted a modest 1.38% increase from October to November, as aluminum prices moved sideways throughout October. Although aluminum prices only rose by 0.99% during the month, they managed to outperform other base metals, such as copper, nickel, zinc, and tin, which saw more significant declines. However, prices began slipping in mid-November, reflecting a broader bearish trend in the base metals market.

China announced that it would end export rebates for aluminum and copper products, effective December 1. The news, which came as a surprise to markets, caused aluminum prices to jump temporarily. The end of export rebates could potentially reduce the amount of Chinese aluminum on the global market, providing some support for global prices.

Meanwhile, alumina prices have remained elevated due to ongoing supply uncertainty. Guinea, a key supplier of bauxite, has halted exports, fueling supply fears and driving up costs. Although alumina prices have recently retreated from their peaks, they remain high, contributing to increased producer costs. Guinea previously supplied an estimated 70% of China’s bauxite imports, and the export stoppage is adding pressure to aluminum production costs globally.

Despite these factors, it remains uncertain to what extent they will impact global aluminum prices. Some analysts believe aluminum prices could continue to outperform other base metals, even if broader base metal markets trend lower.