Aluminium climbs as attacks on Iran spotlight supply concerns
March 2 (Reuters) - Aluminium prices rose on Monday as the U.S.-Israel attack on Iran heightened concerns over potential disruptions to shipping in the key Strait of Hormuz, a critical route for global commodities.
The most-active aluminium contract SAFcv1 on the Shanghai Futures Exchange climbed 3.21% to close daytime trading at 24.465 yuan a metric ton, having touched a four-week high of 24,495 yuan.
The benchmark three-month copper CMCU3 on the London Metal Exchange CMAL3, meanwhile, climbed 2.79% to $3,227.50 a ton as of 0700 GMT, after touching a one-month high at $3,232.
Israel launched a new wave of strikes on Tehran on Sunday and Iran responded with more missile barrages, a day after the killing of Supreme Leader Ali Khamenei pitched the Middle East and the global economy into deepening uncertainty.
Tankers have suspended transit through the Strait of Hormuz, though it has not yet been blocked.
The Middle East region produces about 6.85 million tons of refined aluminium, about a tenth of global output and a quarter of production outside China, according to Natalie Scott-Gray, senior metals analyst at StoneX.
Most of the metal is exported, and it made up about a fifth of Europe's aluminium imports in 2023 as the continent shifted away from Russian material.
The war would tighten supply further, traders say, with China close to its capacity ceiling and exchange inventories running below seasonal norms.
Copper meanwhile, ticked upwards. The most-active Shanghai copper contract SCFcv1 closed 1% higher to 103,850 yuan a ton, and London benchmark copper CMCU3 gained 0.34% to $13,389 a ton.
Copper prices rose to a four-week high last week but remain under pressure from rising global inventories as stocks sitting in warehouses with SHFE rose to a 10-year high.
Among other SHFE base metals, zinc SZNcv1 gained 1.12%, lead SPBcv1 added 0.63%, nickel SNIcv1 rose 1.09% and tin SSNcv1 surged 2.96%.
Elsewhere on the LME, zinc CMZN3 rose 1.16%, lead CMPB3 added 0.82%, nickel CMNI ticked 0.20% higher and tin CMSN3 declined 2.51%.
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