Aluminium Market Outlook – First Quarter 2010
Global aluminium demand remains weak, supported almost solely by increased Chinese off take, in part due to restocking. As China’s restocking process comes to an end, an increase in demand outside China will be required to prevent renewed weakness in global demand. RBC ethat global aluminium demand declined by9.5% in 2009, and forecast a rebound of 10.9% in 2010 and 7.9% in 2011, and trend growth of 5.0% thereafter. The information contained herein has been obtained from sources, which we believe to be reliable, but we cannot guarantee its accuracy or
completeness. RBC Dominion Securities Inc. accepts no responsibility for the info contained herein.
RBC CM analysis suggests that capacity utilization rates have fallen to levels not ssince the early 1980s, and expect the industry to struggle under the weight of significant excess capacity throughout our forecast period. The recent rally has pushed the aluminium price above levels we would expect based on the historical inventory price relationship. Investment funds flows and concerns about weather related power shortages in China have driven the rally. RBC CM believes prices will be constrained by excess inventories and capacity throughout our forecast period. RBC CM forecasts an average price of
.80/lb in 2010,
.80/lb in 2011,
.85/lb in 2012, and
.90/lb in 2013. The long-term forecast is
.90/lb in 2009 US$

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