Financing deals make aluminium production attractive in oversupplied market

The financing deals which have trapped large aluminium stocks in warehouses are here to stay, market participants have told Metal Bulletin.

These deals, along with low LME prices, have resulted in aluminium premiums hitting the roof. Unless the interest rates rise suddenly making these deals unviable or huge curtailments are seen, these financing games are here to stay, participants believe. “We think the market is going to stay in a big surplus that is going to pressure the front end prices and they continue to drive the contango on the forward curve so it continues the conditions that make financing deals profitable,” Barclays' analyst Gayle Berry...

Published

Shivani Singh

May 06, 2013

11:20 GMT

Singapore