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Aluminium

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A bit of a long term view of Ali in AUD terms for context with least squares trend and 2SD applied. Notwithstanding the overall volatility, pretty weak trend over these ~35 years, of which current price is fairly near.... FWIW.

I kinda like commodity plays at or near "minimum value". Of course, further shorter term analysis can be applied, but I like to stand back to see if there are bottom drawer opportunities.

 
Long term IMO, it is difficult to think Ali will not be just as important as batteries, in BEV development.
To get the range, it will be cheaper to reduce the weight, than improve the batteries.
Just my opinion.
 
Aluminium prices shot up over the past few days to the highest in a decade following a coup in Guinea.
Guinea exported 82 million tons of Bauxite in 2020, which places it at no 2 behind Australia.
Mick
 
New record price set for aluminium:


In anticipation of the trend continuing I added more S32, even though it's not yet producing:
"South32 Chief Executive Officer, Graham Kerr said “We are excited to participate in the restart of the Alumar smelter using 100% renewable power. With the smelter benefitting from existing infrastructure, access to our own supply of alumina and long-term green energy sources, we expect our investment to deliver strong returns through the cycle."​

 
from a Bloomberg article ...

On the London Metal Exchange, spot prices for the metal have surged above $US3300 ($4630) a metric ton for the first time since June 1988. Worse, manufacturers are paying eye-watering surcharges above the LME price to get hold of physical metal. For example, European consumers of billets – a widely traded form of aluminium – face a premium of about $1500 per ton, four times higher than the average from 2000 to 2020.

 
Wondering why S32 has gone nuts the past year? They have a few commods, including this one.

I suppose this applies to most commods at the moment.


 
I'm tipping Aluminium to breach US$4000/tonne this year.
I'm presently searching for when inventories were so low.
Regardless, warehouse drawdowns suggest LME won't last 6 months.
Depending on what happens with Russian supply in coming weeks, there is a chance my target price is hit many months earlier.
Hopefully on the weekend I can pull some useful data to post.
 
Anyone can enlighten me vs the story of Australia not shipping alumina to Russia?
Is it just me but are we not the sucker there?
Russia is 80% self sufficient in alumina and nevertheless is producing for the world market, not for Russia
So we breach our contracts preventing our sale of alumina, to a country which does not need it anyway as they are supposedly not able to sell russian aluminium?
The European smelters will just buy more russian gas and oil at a higher price to produce aluminium for the west using more expensive ore....
So we barely hurt Russia but ensure aluminium gets more expensive...
If the Aluminium price increases by more than 20%, then the Russian sales to ...China now.. will ensure a net win for Russia...?
With strategies like that..
 
Another weekend passed, but this is up to date and relevant.
From the publication we see this regarding the impact from EV production:

And a slightly different perspective from the chart below: in 5 years time EV use of aluminium will be equal to Russia's total annual output:
 

Aluminum Orders Stall as U.S. Buyers Fear Looming Recession​


(Bloomberg) -- Aluminum buyers in the U.S. are holding off inking new orders over fears that rising inflation and crumbling supply chains may spark a recession.

Spot deals have taken a breather in recent weeks as Russia’s invasion of Ukraine added increased uncertainty in a market already facing long wait times and weakening demand, according to several people who trade the lightweight industrial metal. Buyers continue taking delivery of their contracted metal, but recent economic gauges have people worried enough to hold off purchasing extra for their shipments.

Read the rest of the article here...

Looking at the Aluminium price chart I have to ask will it yet again bounce back up off the 200dma? I am really liking the look of the chart shape.



hold AWC, A4N
 
i see rising energy costs as the main worry with aluminum ALTHOUGH , Russia has a fair influence over aluminum production and MIGHT consider a bit of export restrictions of their own ( to go with the oil , gas , coal , fertilizer conditions of payment )

i hold CSR , and several NZ power companies ( affected by the fate of a NZ smelting complex )

as the old saying is rising prices are the best weapon against rising prices , but that brings in a question of how manufacturers cope with this ( many need plenty of energy AND aluminum )
 
well just buying more Russian gas has hit a bit of a snag ( for Europe ) , and Russia has it's own alumina and aluminum processing capabilities including various types of power plants ( including nuclear ones )

so are we sending Australian alumina to Russia when there is a NZ smelter with an uncertain future , and energy starved Australia ( sarcasm ) is incapable of processing it's own alumina

so yes if the story is correct .. it is just another Australian sucker story

fun fact , my first win in the Sunday School fancy dress competition i was dressed up with banana leaves and bark with a sign 'just another sucker ' ( sometimes cheap and cheeky takes the prize )
 
divs4ever said:
the operative work is 'help' however battery-makers will have a BIG GRIN at the thought of that little exercise ( the guys repairing the turbines will have an employment future , as well )
Click to expand...
it's actually scary as there is one thing you can not do with smelters is shutting power..and end up with a jack hamer trying to cut thru a big blob of solidified metal..
Did we not experience that in SA.
It s as critical as hospital power except you can not run it on generator..so intermitten energy source and smelter do not mix
 
haven't worked with smelters but have worked where a ( steam ) boiler was essential to production ( rubber moulded products ) and the boiler going down put a real kink in production for quite a while ( so couldn't begin to grasp the same problem with a smelter )
 
bk1 said:
Oh the irony...
Click to expand...
yes i remember an article ( several years back ) where a Mexican firm had the major steel components of wind turbines , made in the USA , because transport costs were heavier than the savings on cheap Mexican labour ( for turbines to be erected in the USA , of course )

interesting times

maybe voters will stop electing lawyers into political positions
 
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