May 23 (Bloomberg) -- Aluminum reached a three-week high in London on speculation that supplies of the metal will trail global demand. Copper rose for the third straight week, the longest rally since February.
The aluminum market will be in deficit this year by 1.3 million metric tons, leading global producer United Co. Rusal said today. China’s imports of bauxite, used to make the metal, dropped 14 percent in April, customs data showed this week. Indonesia, China’s main supplier in 2013, banned raw-ore exports in January.
“Concerns of the Indonesian ore ban impacting bauxite availability have been voiced recently,” Vicky Sanders, head of analytics sales at Marex Spectron Group in London, said in a note. “We would caution that tightness isn’t expected to have a material effect until mid-2015/2016.”
Aluminum for delivery in three months added 1 percent to close at $1,814.50 a ton at 5:51 p.m. on the London Metal Exchange after touching $1,824.15, the highest since April 29.
Copper inventories available for removal from LME warehouses fell below 100,000 tons for the first time since 2008.
The metal for delivery in three months gained 0.6 percent to $6,918.75 a ton ($3.14 a pound) on the LME, leaving prices up 0.9 percent this week. Copper for immediate delivery settled at a $93-a-ton premium to the three-month contract, indicating limited supply.
“Copper remains supported above $6,850 by lower stockpiles and higher premiums for immediate deliveries,” RBC Capital Markets LLC said in a note.
On the Comex in New York, copper futures for July delivery rose 0.8 percent to $3.1675 a pound.
Disrupted output at LS-Nikko Copper Inc. also supported prices, said Chae Un Soo, a metals trader at Korea Exchange Bank Futures Co., in Seoul. The company was ordered to halt operations at a smelter in Ulsan, South Korea, after a fire broke out yesterday. Operations at another smelter remain suspended after a blast on May 13.
Tin, lead and zinc climbed in London. Nickel fell.
--With assistance from Jae Hur in Tokyo.