World Primary Aluminium Ingot Oversupply in 2007, Marubeni

World primary aluminium ingot supply will be 42,000 tonnes of oversupply in 2007 for the first time in 4 years, according to forecast announced by Marubeni Corporation on Monday. The firm expects the demand will increase by 5.8% to 36.257 million tonnes in 2007 from estimate in 2006 while the supply increases by 7.0% to 36.299 million tonnes due to higher output in China, Middle East, Russia, India and Iceland. With the oversupply, the firm expects aluminium ingot 3-month future price will decrease to US$ 2,000-2,700 per tonne level at London Metal Exchange in 2007. The firm expects the demand increases by 1.2% to 6.635 million tonnes in USA, by 1.7% to 7.048 million tonnes in Western Europe, by 1.8% to 2.398 million tonnes in Japan and 14.7% to 9.898 million tonnes in 2007 from 2006. The firm expects the largest producing country of China will increase the output by 12.7% to 10.398 million tonnes, which is the first 10 million tonnes of output. The firm expects the output will increase in various areas and countries when the output will increase by 11.6% to 2.531 million tonnes in USA and by 7.8% to 4.606 million tonnes in Commonwealth of Independent States. The firm expects the LME aluminium 3-month future price decreases to averaged US$ 2,300 per tonne in 2007 from the high level in 2006 depending on speculating activities, electricity supply, alumina supply, Chinese export and world economy. The firm expects Japan premium price is US$ 60-90 per tonne in 2007.