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The generally weak performance of the base metals complex came as the overnight strength in the US dollar continued into the Asian morning session.
The dollar index stood at 95.16 as at 09.37 am Shanghai time.
The most-traded aluminium contract on the SHFE stood at 14,835 yuan ($2,168) per tonne as at 09.37am Shanghai time, up by 340 yuan per tonne from Wednesday’s close.
“The rise in the light metal’s price was in response to the news of a strike at Alcoa in Australia and the potential of further sanctions on UC Rusal, which might cause supply tightness,” a Shanghai-based analyst said.
Alcoa workers have gone on strike in Western Australia after a breakdown in negotiations between company management and the Australian Workers’ Union (AWU).
“Workers at Alcoa’s three refinery systems, boasting an over 8 million tpy of alumina in total, have voted to strike and this is causing supply worries,” the analyst added.
Meanwhile, further uncertainties remain in the market while negotiations between the United States and UC Rusal continue over the lifting of sanctions against the Russian aluminium producer, Metal Bulletin’s analyst James Moore said.
Elsewhere, the most-traded SHFE copper contract price dipped 20 yuan this moring. The drop comes despite ongoing labor strikes in South America, including at the world’s largest copper mine by production, Escondida.
Base metals prices • The SHFE November nickel contract was up 10 yuan to 114,120 yuan per tonne. • The SHFE October zinc contract fell 45 yuan per tonne to 21,480 yuan per tonne. • The SHFE September lead contract dipped 50 yuan per tonne to 18,405 yuan per tonne. • The SHFE September tin contract was down 800 yuan per tonne to 146,330 yuan per tonne. • The SHFE October copper contract slid 20 yuan per tonne to 49,510 yuan per tonne.
Data releases and currency moves • The dollar index was up 0.07% to 95.16 as at 09.37am Shanghai time. • In other commodities, the Brent crude oil spot price was up by 0.27% to $72.39 per barrel as at 09.37am Shanghai. • In equities, the Shanghai Composite was up 0.26% to 2,751.31 as at 09.59 am Shanghai time. • In data on Wednesday, US crude oil inventories came in under expectation at -1.4M, against forecast reading of -2.8M • Meanwhile, China’s trade surplus with the United States dipped only slightly to $28.09 billion for July, slightly down from $28.97 billion in June. • In data today, United States’ Producer Price Index, Jobless claims and Statement of Reserve of Australia are due.