According to Goldman, the aluminum inventories are currently at their lowest levels since 2002.
SEATTLE (Scrap Monster): Goldman Sachs, leading U.S. multinational investment bank and financial services company, has lifted its price forecasts for aluminum. The anticipated robust prices for the metal are mainly on account of expectations of possible supply shortages driven by increased demand in China and European countries.
In a note to clients, Goldman analysts Nicholas Snowdon and Aditi Rai noted that aluminum prices in London are likely to average at $3,125 per ton during the current year. This is significantly higher when compared with the bank’s previous forecast of $2,563 per ton and the current price of $2,595 per ton. It expects aluminum to touch heights of $3,570 per ton over the next twelve-month period.
According to Goldman, the aluminum inventories are currently at their lowest levels since 2002. The global inventories, at around 1.4 million tons, are down by almost 900,000 tons from the year-ago period. The price momentum is likely to see an upside momentum, mainly triggered by benign macro environment, weakening dollar headwinds and a slowing rate hike cycle.
It must be noted that aluminum prices had hit peaks in February 2022, following Russian invasion of Ukraine. However, it has declined afterwards. The bleak outlook had forced many smelters to cut top production.
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