Aluminium inventories in warehouses registered by the London Metal Exchange climbed to the highest in more than a month after inflows of 38,725 metric tons into South Korea, LME data showed on Tuesday.
The metal, which arrived in storage facilities at the port of Gwangyang, pushed up total LME inventories by 8% to 529,775 metric tons, the highest since July 12, according to the data.
Rising inventories can indicate the market has surplus metal and investors have been concerned about tepid industrial metals demand in China amid weak factory activity and struggles in the property sector.
At the same time, aluminium output has been rising in top producer China, reaching in July as smelters in the southwestern province of Yunnan ramped up production as hydropower supplies improved.
The benchmark LME three-month aluminium price CMAL3 has shed 9% so far this year and was up 0.8% on Tuesday morning at $2,162 a metric ton.
Investors have also been keenly watching LME inventory levels due to the large proportion of Russian aluminium in the exchange’s warehouses as some consumers shun metal from the country even though they are not directly targeted by Western sanctions imposed on Moscow.
In July, aluminium stocks of Russian origin in LME depots that are available to the market accounted for 81% of the total, a monthly LME report showed.
The daily LME stocks data does not indicate the country of origin.
Source: Nasdaq
