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METALS-Aluminium set for worst week in 18 months on China output

From Reuters - November 10, 2017

(Adds official prices)

By Zandi Shabalala

LONDON, Nov 10 (Reuters) - Aluminium edged into positive territory on Friday but was still on track for its worst week since May 2016 as speculative investment flows ebbed on caution over the scale of expected Chinese capacity cuts.

Benchmark aluminium on the London Metal Exchange was bid 0.5 percent higher at $2,103 a tonne after it failed to trade in official rings. The metal used in cans and kitchen utensils fell to its lowest since Sept. 15 on Thursday.

In China, it looks like the actual policy translation is not as strong as initially expected, said ETF Securities Nitesh Shah, adding that smelters were not cutting as much capacity as initially expected and that was translating into a prices retreat.

CHINA: The worlds biggest producer of aluminium is expected to cut millions of tonnes of aluminium capacity during the winter to combat air pollution, helping to push prices to five-year highs last month.

ALUMINIUM INVENTORIES: Stocks in LME-approved warehouses fell to their lowest since September 2008, down 3,600 tonnes to 1.2 million tonnes. But stocks in Shanghai inched higher this week to a record 666,581 tonnes.

REUTERS POLL: A Reuters poll of 29 analysts this week produced a consensus view that aluminium prices have already peaked. Analysts expect an average 2018 price of $2,038 a tonne.

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