FX.co ★ Aluminum Rises to 3-Month High

Aluminum futures have climbed toward $2,600 per tonne, approaching their highest level since March, driven by concerns about raw material supply coupled with expectations of sustained robust manufacturing demand throughout the year. The global supply of bauxite remains uncertain due to the ongoing disagreements between the Guinean government and Emirates Global Aluminum over mining operations within the country. This situation has threatened mining licenses in one of the world's largest bauxite-producing nations. Compounding the issue, Guinea's limited exports in May led to a 21% decrease in China's imports compared to the previous month, prompting the world's leading aluminum producer to source raw materials from other countries. Simultaneously, although on-warrant stocks in the London Metal Exchange (LME) inventories have increased since the beginning of the year, combined inventories on the LME and the Shanghai Futures Exchange (SHFE) are approximately 60% lower than during the same period last year.