Market
August 27, 2024
CRU: Market Update, August 27, 2024
Written by Guillaume Osouf
The LME 3-month price is moving lower again on the morning of August 27 and was last seen trading at $2,522/mt. On Friday afternoon, the price managed to break through a level of resistance at $2,500/mt. Although, the price is down this morning from last Friday’s close, it appears to be building support above $2,500/mt.
Last Friday, U.S. Fed Chair Jerome Powell delivered his speech at the Jackson Hole annual central bankers’ summit in Wyoming, where he said: “the time has come” for the Fed to begin cutting rates. The first cut is now expected to come at the next Federal Open Market Committee meeting on September 18. The question for investors now is: at what pace the Fed will ease policy? With Powell emphasizing that he is particularly concerned about the labor market, the next most important update will be the nonfarm payrolls report due on September 6.
Meanwhile, the SHFE aluminum cash price continued to make steady gains across the long weekend. The cash contract first settled at RMB19,850/mt and last traded at RMB19,855/mt.
Canada set to impose tariffs on Chinese-made EVs and aluminum products
The Prime Minister of Canada, Justin Trudeau, announced on Monday that Canada will impose punitive tariffs on Chinese-made electric vehicles to stop what has been described as “unfairly” state-subsidized cars. Mr. Trudeau made the announcement at the federal cabinet retreat in Halifax where ministers are meeting to craft a strategy for the year ahead.
The Canadian prime minister said that a 100% surtax will be levied on all Chinese-made EVs, effective October 1. Mr. Trudeau said the initiative is aiming to “level the playing field for Canadian workers” and allow Canada’s nascent EV industry to compete at home, in North America and globally. He also announced the federal government would apply a 25% surtax on imports of steel and aluminum products from China, effective October 15.
In a media statement, a spokesperson for China’s foreign ministry said the country “expresses strong dissatisfaction and firm opposition to this,” before adding, “This move will undermine the normal economic and trade cooperation between China and Canada. It harms the interests of Canadian consumers and enterprises and is not conducive to Canada’s green transformation and global efforts to combat climate change.”
Ukraine fails to sell Zaporozhye Aluminum Plant, Interfax reports
A second auction to sell the Ukrainian government’s 97.54% stake in JSC Zaporozhye Aluminum Plant (ZAlK) that was scheduled for August 22 was called off due to the absence of bids, Ukrainian media reported.
Ukraine’s State Property Fund first attempted to sell the state stake at an auction on August 6 but was also called off because of the absence of bidders.
“Zaporozhye Aluminum Plant is an excellent brownfield project, since it is located in Zaporozhye, next to the national N08 highway. The asset’s advantages include the large area of structures and land parcel,” the Property Fund said earlier.
The plant was controlled by Rusal for many years, but in 2015 the Ukrainian authorities renationalized 68% of shares. Another 29.5% stake was seized for the state in February 2023 by order of the High Anti-Corruption Court in a lawsuit brought by the Justice Ministry.
Rusal develops aluminum metro carriage
Rusal is developing a metro carriage made entirely of aluminum alloys. This project aims to benefit the engineering and transportation sectors by reducing the metro carriage’s weight by at least 2 tonnes compared to its steel counterparts. This weight reduction will result in significant energy savings during metro operation and lower costs for new energy infrastructure.
Rusal has commissioned a research and development project (R&D) to create the design of an aluminum metro carriage. Leading engineering companies are conducting R&D consultations with engineering enterprises and metro systems in Russia.
In the new metro carriage model, the frame, body, and interior and exterior parts will be made of aluminum alloys, while the wheels and bogie will remain steel. Furthermore, aluminum profiles for the metro carriages will be manufactured by extrusions, with integrated frames for monitors, holders for lighting fixtures, ventilation system recesses and other interior design elements.
