The red metal price has been on a steady path of recovery since a low of $7,949 per tonne at 5pm on January 15.
Meanwhile, aluminium’s price continued to drop this morning, down by 0.8% at $1,957 per tonne and breaking its support level of $1,976 per tonne.
There was an 112,500-tonne delivery of aluminium to LME sheds across Asia on Monday morning, which caused the light metal price to fall by almost 1% to $1,972 per tonne at the 5pm close.
It was the first time total aluminium stocks rose by over 100,000 tonnes in a single day since 2018.
Another sizeable deliverable of 22,800 tonnes of aluminium entered LME sheds on Tuesday, with the majority (20,375 tonnes) arriving in Port Klang, Malaysia.
Aluminium’s cash-to-three month spread has continued to widen, reaching $11.50 per tonne contango shortly after 9am on Tuesday from $10.50 per tonne contango on Monday.
“With aluminium turning lower and following zinc’s downward move, it does raise the odds that sentiment may be weakening and a loss of momentum on the upside is leading to some long liquidation,” William Adams, Fastmarkets’ head of base metals and battery research, said.
Zinc’s three-month price has been falling continuously since January 12, when it sat at $2,778 per tonne. It was down by 0.6% to $2,667.50 per tonne this morning.
“Given the gains and the drawn-out upward trends of recent months, we should not be surprised by some countertrend moves. That said, tin and nickel were setting or matching recent highs only recently, so maybe the individual metals will follow their own courses for a while,” Adams said.
Tin’s three-month price, which had increased by 0.6% to $21,235 per tonne at the 5pm close on Monday – the biggest increase of its peers on the day – was down again on Tuesday morning.
The metal’s price fell by 1.3% to $20,960 per tonne, around to same levels it held one week ago. Tin’s lowest closing price this year so far has been of $20,700 per tonne, on January 11.
The US Dollar Index was quoted at 90.64 at 9am, slightly lower than 90.88 at the same time on Monday, but markedly higher than its low this month of 89.21 on January 6, thus keeping metal prices subdued.
- Janet Yellen is expected to be confirmed by the US Senate today as US Treasury Secretary. She will talk virtually 10am local time (3pm GMT) about Biden’s suggested $1.9 trillion Covid-19 relief plan.
- Economic data out today includes the European Union’s current account, Italy’s trade balance, EU and Germany economic sentiment from Zentrum fur Europaische Wirtschaftsforschung (ZEW).
- There is also an all-day EU Economic and Financial Affairs Council meeting, with finance ministers from EU member states in virtual attendance.