Aluminium Ingot Prices Climb in Asia and Europe Amid Economic Stimulus and Supply Issues

In the week ending September 20^th, Aluminium Ingot prices experienced a notable increase across Asia and Europe, driven by a combination of government economic stimulus measures, raw material supply constraints, rising factory input costs, and the Federal Reserve's interest rate cut.

China, a key player in the global aluminium market, saw a 0.5% increase in Aluminium Ingot prices during this period. The Chinese government's recent announcement of a series of policy measures aimed at supporting the economy and property market has been a significant factor in this uptick. These measures include interest rate cuts and additional stimulus packages, which have positively influenced global investor sentiment and resulted in gains for domestic metal stocks, including Aluminium Ingot. The property market support package in China, featuring a 50-basis point reduction in average interest rates for existing mortgages and a cut in the minimum down payment requirement to 15% for all types of homes, is expected to further boost demand for Aluminium Ingot. Adding to the demand side, Chinese domestic aluminium processing enterprises have received new orders requiring primary aluminium for production. This surge in demand comes ahead of the implementation of tariffs by many countries on Chinese aluminium, further contributing to the price increase.

In Germany, Aluminium Ingot prices saw a more substantial increase of 0.9%. This rise is primarily attributed to supply-side factors, particularly the tightness in raw materials such as alumina and bauxite. Alumina prices in Germany have been high due to growing demand and limited supply, with inventories in London Metal Exchange (LME) warehouses dropping significantly in recent weeks. The global supply squeeze has been exacerbated by disruptions in bauxite shipments from Guinea, the world's top producer, and production cuts in various regions. Additionally, a softer US dollar has been a key factor in the recent rise of Aluminium Ingot and other base metal prices. European markets have also seen an increase in electricity prices during this period in September, due to higher demand and decreased solar production in some regions. This rise in energy costs has further supported the upward trend of Aluminium Ingot prices.

As the market enters a period of increased activity, these developments are expected to significantly impact Aluminium Ingot prices. The combination of the approaching peak consumption season and ongoing economic stimulus measures paints a positive outlook for the Aluminium Ingot market. Chemanalyst forecasts a continued expansion in the Aluminium Ingot market, anticipating that prices will persist in their rising trend over the upcoming weeks.