Aluminum prices rose in London on Tuesday amid fears of supply disruptions as ceasefire talks between Russia and Ukraine showed no signs of progress.
Three-month London Metal Exchange (LME) aluminum rose 0.3% to $3,532/t as of 05:15 GMT, hovering around a nearly two-week high on Monday.
Shanghai Futures Exchange's top-traded May contract fell 0.3% to 22,950 yuan (approximately $3,608) per tonne.
"The war in Ukraine remains a key support for metals and may have contributed to more volatility in recent weeks," Matt Simpson, City Index senior marketer, was quoted by Reuters.
Aluminum supply problems have been exacerbated by Australia's ban on exports of alumina and aluminum ore to Russia as part of sanctions against Moscow, while Germany-based TRIMET is also due to cut aluminum production at its Essen plant by 50% due to higher prices for energy.
Ukrainian President Volodymyr Zelensky said on Monday that it is impossible to agree on an end to the war without meeting with Kremlin leader Vladimir Putin, and the conflict is now in its fourth week.
“Global production outside of China is already struggling, and further supply losses raise the possibility of wider shortages,” ANZ analysts said.
Aluminum stocks in LME warehouses amounted to 704,850 tons, which is the lowest level since 2007. Inventories of aluminum at exchange warehouses in Shanghai also fell by 4.2% to 333,823 tons last week.
Last Friday, the London Metal Exchange's copper committee recommended a ban on the entry of Russian copper into its warehouses. According to MIRDC researchers, LME copper inventories fell in February to almost a 5-year low, which was an important factor in the recent strong increase in copper prices.
