Aluminium hits 13-year high to $3k a tonne

Benchmark London aluminium prices touched $3,000 a tonne for the first time in more than 13 years on Monday, on fears that supply will run short.

Prices soared over a Chinese government document which reportedly stated that the world's biggest producer and consumer of the metal in southwest China's Yunnan province, home to about a tenth of the country's aluminium capacity, has told green aluminium smelters to keep their monthly output in September-December no higher than August levels.

The soaring price also reflected the worsening situation of the recent military coup in Guinea. The African nation possesses the world's largest reserves of bauxite, the reddish or grey rock, whose aluminium oxide is smelted into aluminium, a metal widely used in everyday items.

Aluminium prices had already been rising sharply before the coup struck at the start of the month, up by about 40 percent since January as global economic activity bounces back from the Covid-19 trough.

Also pushing prices higher are rising electricity prices in China, which has led to a sag in production at a number of foundries in its western Xinjiang region. Aluminium smelting consumes voracious quantities of energy.

Guinea's ruling military has been coming under growing diplomatic pressure after special forces led by Lieutenant Colonel Mamady Doumbouya seized power and arrested president Alpha Conde.