Base metals set for best week ever as war stokes shortage fears
A Bloomberg gauge of industrial metals jumped 11% this week, on course for the biggest rise on record. Aluminum hit a new high on Friday, nickel jumped 7.8% to its highest level in a decade and zinc is the most expensive since 2007.
It is becoming increasingly difficult to transport raw materials like metals since almost half of the world’s container ships no longer go to Russia, a crucial supplier of aluminum and nickel. Soaring global fuel prices are also a headache for the market as production costs rise and put pressure on foundries.
Nickel was among the biggest movers this week, jumping 16%, to trade at $28,255 a tonne on the London Metal Exchange. Russia is a key source of the metal, crucial for electric vehicle batteries and stainless steel. Aluminum rebounded 13% this week, poised for its best showing. Zinc rose 11%, while copper also climbed near a record high.
Even before the war, metal prices were soaring amid the global post-pandemic recovery, as demand rebounded and suppliers were limited. Yet the Russian invasion took prices to a whole new level, adding inflationary pressure to global markets.
(By Thomas Biesheuvel)