Aluminum price will average $ 1840 per ton in 2015 - Natixis

The French bank Natixis in its latest report predicts the price of aluminum on the London Metal Exchange (LME) to average about $ 1840 per tonne in 2015, and an average of about $ 2,000 per tonne in 2016.

In its H1 2015 metals survey, Natixis predicts a tug of war between positive and negative factors in the aluminum market over the next few years. The bank points out several positive factors that could contribute to the recovery in the aluminum market. These include the steady growth in demand from the automotive industry. In addition, any shortage of bauxite could lead to higher prices for alumina production. Limiting oversupply from China bodes well for prices in the coming years.

On the other hand, an increase in low-cost aluminum production in China and an increase in production in Russia amid a weakening ruble may lead to more affordable prices on the international market. If so, average prices are likely to fall to $ 1,700 per tonne in 2015 and 2016, the bank said. At the same time, Natixis predicts that excess aluminum stocks may remain at least until 2018, which could lead to a further drop in prices. In addition, the strengthening of the dollar is a negative factor for aluminum, along with other commodities in general.

Natixis also points to a number of situations that could lead to an increase in the price forecast. Under certain scenarios, an acute shortage of bauxite could delay alumina supplies. Chinese government interference with export regulations and VAT refund regulations could restrict the export of semi-finished aluminum products from China. If so, aluminum prices could average around $ 2,000 per tonne in 2015 and rise to an average of $ 2,250 per tonne in 2016.