Aluminium at 5-year low on grim demand outlook

Print this page Posted on : 12-06-2008 by recycleinme.com

Aluminium dropped to its lowest level in more than five years and copper tumbled to a 3-1/2 year low on Friday, as a rapidly deteriorating world economy dampened the outlook for metals consumption.

Aluminium for three-month delivery on the London Metal Exchange hit $1,530 a tonne, its lowest since November 2003. The power-intensive metal was at $1,540 a tonne by 1051 GMT, still down from Thursday's close of $1,586. Copper sank to $3,117 per tonne and was last at $3,139 per tonne, down $131 from Thursday.

DEPRESSION

Barclays became the latest bank to once again downgrade its price forecasts for metals, citing the expectation of a deeper and longer global recession.

"The scale of the price decline in some metals suggests that the market is pricing in a worse deterioration in market conditions than was witnessed during the Great Depression,'' the bank said in a research note.

It now expects copper at $2,900 per tonne in the first quarter of next year. Bleak demand was mirrored in rising copper stocks, now at 297,300 tonnes - having risen nearly 100,000 tonnes in only two months. Lead hit its lowest level since June 2006 and was last at $975 a tonne from $980 while zinc was at $1,125 compared with $1,145. Nickel fell to $9,260 from $9,250 while tin eased to $11,675 from $11,850.

Source : Business Line