FX.co ★ Aluminum Approaches 3-Year High

Aluminum futures recently stood firm at $2,700 per tonne, maintaining a momentum that nearly reached a three-year peak of $2,715 on September 16th, driven by expectations of reduced supply. The Chinese Ministry of Industry and Information Technology revised its annual output growth target for base metals, setting a new goal of 1.5% per year for 2025 and 2026, significantly lower than the previous 5% target. This adjustment aligns with Beijing's campaign against 'involution'—an initiative aimed at slowing manufacturing capacity to mitigate deflationary pressures—raising global concerns of potential supply shortages. Furthermore, Guinea Alumina faced a major setback as it lost all of its mining licenses following a decision by Guinea's military-led government to reassign all mining leases to a newly established state-run company, which may disrupt the supply chain for major producer Emirates Global Aluminum. The immediate demand for physical aluminum led to a spike in withdrawal requests from global warehouses, causing primary aluminum stocks to fall by 55,000 tonnes in September, down to 413,000 tonnes, although levels have since partially rebounded from their monthly lows.