Expert aluminium market insights
Our quarterly aluminium outlook is published in our Quarterly Metals Report, which covers base, precious and ferrous metals. The impact of supply and demand fundamentals, including LME and SHFE stocks and macroeconomic implications for the aluminium futures and spot prices are analysed. Our research team produce an aluminium price range forecast as part of the report.
Aluminium Outlook – Q1 2024
Aluminium prices have fluctuated due to macroeconomic factors, including the Chinese economic outlook and expectations for monetary policy. The Q1 2024 narrative is driven by postponed rate cut probabilities and Chinese pessimism, making it difficult for aluminium prices to break out of their current range. Although macro factors remain key to day-to-day activity, the Fed will continue to drive aluminium’s price momentum. Despite potential supply shocks, there is ample liquidity to absorb them quickly. We anticipate wider trading ranges with slight upside potential amid increasing volatility.
During the last quarter, the markets expected the Fed to begin a cutting cycle, which caused the dollar and Treasury yields to decrease. This, along with predictions of China's recovery in 2024, boosted the prices of base metals by the end of the year. However, in Q1, the situation has changed. The US economy has shown robustness in terms of the labour market and consumer performance, which has led the market to price in the probability of cuts further down the curve. Additionally, despite continued support from the government, Chinese pessimism has yet to subside. In the upcoming months, macroeconomics will continue to play a crucial role in driving the day-to-day momentum, particularly in the aluminium and copper markets. Structural and cyclical indicators will also come into play when assessing the path for base metals performance. COT positioning, spreads, and stocks will drive the general price trend in the first half of the year while anticipating an economic recovery and easing monetary policy pressures in the latter half of the year.
We will email you each time a new report has been published.