Metal Market Insights: Global Aluminium Output Holds Steady, Nickel Spreads Surge, and Indonesia's Copper Exports to Cease

Metals – Global aluminium output remains flat

The latest numbers from the International Aluminium Association (IAI) show that average daily global primary aluminium output stood at 188.7kt in May, compared to 188.4kt a month earlier. Total monthly output for the metal remained almost flat year-on-year at 5.85mt in May, although it was up 3.5% MoM. Cumulative aluminium production over the first five months of the year rose 1.8% YoY to 28.5mt. Chinese output is estimated to have increased by 3.7% MoM while remaining flat YoY at 3.5mt in May. However, YTD production is still up 2.9% YoY to 16.8mt. Production in Western and Central Europe has shown some recovery on a monthly basis with output rising 2.2% MoM, although it still declined 8.4%YoY to 229kt last month. Meanwhile, aluminium production in Asia (ex-China) rose 2.6 YoY to 397kt in May.

The continuous inventory drawdown in nickel saw spreads spike in LME with the tom-next spread surging to US$75/t, the highest since 2010, signaling tightness in the deliverable market.

In copper, recent reports suggest that Indonesia will stop exporting copper concentrates as soon as Freeport Indonesia and Amman Mineral International finish building smelters next year. Indonesia expects both facilities to start producing in May 2024.