Eric Onstadjue, April 28, 2022, 2:00 p.m.-2 min read
By Reuters
LONDON, Apr 28 (Reuters) - Aluminum prices rose on Thursday on concerns about supplies of the energy-intensive metal after Russia's Gazprom halted gas supplies to Poland and Bulgaria.
* However, other base metals fell in reduced volumes, due to uncertainty about how rising inflation and the Chinese confinements will affect global growth and the weakening of the Chinese yuan.
* Benchmark three-month aluminum on the London Metal Exchange (LME) was up 0.9% at $3,120 a tonne by 1015 GMT, extending a 1% gain from the previous session.
* "Growing tension over the energy sector will continue to provide long-term support for aluminum. The fundamentals are solid," said Gianclaudio Torlizzi, a partner at consultancy T-Commodity in Milan.
* The interruption of gas supplies to two European countries fueled fears that more states would be affected, especially Germany.
* Aluminum, which requires large amounts of energy in the smelting process, has seen a reduction in operations due to rising energy prices.
* However, the extension of confinements in top metals consumer China to combat COVID-19 has stoked concerns about overall demand for metals, as the country's currency, the yuan, fell to near 17-month lows against the U.S. dollar on Thursday.
* The weakening of the yuan is negative for base metals and it is expected that the yuan could weaken further, which will continue to pressure base metals," Torlizzi added.
* The dollar index was at its highest level since January 2017, making dollar-priced metals more expensive for buyers using other currencies.
* The world economy will expand more slowly than forecast three months ago, according to Reuters polls of more than 500 economists.
* Peruvian police said Wednesday they had evicted an indigenous community that set up an encampment inside a huge open pit at the Las Bambas copper mine, forcing operations to stop.
* Among other base metals, copper was trading almost flat at $9,859 per ton, lead was down 0.1% at $2,280, zinc was down 0.1% at $4,216.50, nickel was down 0.6% at $33,100 and tin lost 0.2% at $39,915.
