Aluminum futures rose toward $2,550 per tonne in June, testing the highest level since the start of the second quarter as risks to raw material supply were combined with bets that manufacturing demand may hold up among major factory hubs. Retail sales in China grew by more than expected to suggest that the recent bout of economic uncertainty did not have a significant impact on consumer demand, limiting bearish bets on the Chinese economy.
On the supply front, uncertainty on the global supply of bauxite persisted amid the Guinean government’s disagreements with Emirates Global Aluminum’s mining operations in the country, jeopardizing mining licences from one of the worlds largest providers of the raw material. A sharper increase was prevented by the increase in open tonnage in LME inventories, despite the risk of squeezes by the large positions taken by Mercuria.
