keywords :
London aluminium and nickel prices rose to multi-year highs on Tuesday, driven by concerns over supply disruption from Russia in an already tight market as tensions escalated in eastern Europe.
Russian President Vladimir Putin ordered the deployment of troops to two breakaway regions in eastern Ukraine after recognising them as independent on Monday.
The United States is coordinating with allies and will announce new sanctions against Russia – a major producer of nickel and aluminium – on Tuesday.
Three-month aluminium on the London Metal Exchange CMAL3 gained 1.2% to $3,318.5 a tonne, as of 0635 GMT, having earlier risen to a more than 13-year high of $3,342. Benchmark nickel CMNI3 rose 1.2% to $24,630, having earlier hit a peak since August 2011.
“Aluminium and nickel continue to look good given any sanctions will likely be targeted at where it will hurt most – commodity exports,” broker Marex said in a note.
The premium for cash nickel over the three-month contract MNI0-3 rose to a three-week high of $522 a tonne on Monday, while the premium for cash aluminium MAL0-3 was at $45.30 a tonne, indicating tightness in nearby supplies.
“In the near- to medium-term, aluminium prices are likely to hover in the higher trajectory, but things may calm once (U.S. President Joe) Biden and Putin come out with an agreement on Ukraine,” said Kunal Sawhney, chief executive at research firm Kalkine, adding that “then, not supply worries, but demand forces would decide prices.”
The most-traded March nickel contract on the Shanghai Futures Exchange SNIcv1 rose to a record high of 181,350 yuan ($28,595.98) a tonne, and was last up 0.9% at 179,800 yuan.
FUNDAMENTALS
* LME copper CMCU3 eased 0.1% to $9,885 a tonne, lead CMPB3 fell 0.4% to $2,324.5, zinc CMZN3 rose 0.4% to $3,572. Tin CMSN3 rose 0.5% to $44,370, having earlier hit a record high of $44,450.
* ShFE copper SCFcv1 fell 0.5% to 71,110 yuan a tonne, aluminium SAFcv1 rose 1.6% to 22,950 yuan, zinc SZNcv1 edged 0.2% higher to 24,905 yuan, lead SPBcv1 was up 0.6% at 15,515 yuan and tin SSNcv1 gained 0.3% to 338,950 yuan.
* Global primary aluminium output in January fell 4.5% year-on-year to 5.513 million tonnes, data from the International Aluminium Institute showed on Monday.
* The global nickel market saw a surplus of 6,500 tonnes in December, compared with a deficit of 3,700 tonnes in November, data from the International Nickel Study Group showed.
* The global world refined copper market showed a 79,000 tonnes deficit in November, compared with a 34,000 tonnes deficit in October, the International Copper Study Group said.
* For the top stories in metals and other news, click TOP/MTL or MET/L