The impact of the Eurozone crisis on price and demand has been dramatic. Aluminium prices currently trade at a around $2150/t, well below the marginal cost of production.
And global demand prospects have weakened. In Europe, sheet and extrusion markets are now declining, with prospects for 2012 looking sluggish.
Demand prospects have dimmed also in North America, although markets such as transportation and solar provide some optimism for growth.
China does not seem to be coming to the rescue either. Demand is reported be weakening in China – partly on much lower exports of sheet - while there is softness evident in domestic white goods markets, as credit tightening bites.
With smelter production rates up in September, both in China and in the rest of the world, the market surplus can only increase in this quarter.
Shipments of primary aluminium by North American producers was 1.257Mt in Q3 2011, level with the previous quarter.