Shanghai aluminium slips after Malaysia lifts bauxite ban

A worker wearing a face mask looks on at a bauxite storage site in Bukit Goh, Pahang. (AFP pic)

BEIJING: Shanghai aluminium prices moved lower in early trade on Tuesday after Malaysia said it would not extend a moratorium on mining bauxite, potentially reducing costs in the aluminium supply chain for top producer China.

Bauxite is a rock refined to make alumina, which is then used to make aluminium metal.

The most traded April aluminium contract on the Shanghai Futures Exchange slipped 0.4% to13,395 yuan (US$1,977) a tonne as of 0156 GMT, just above the two-year low of 13,230 yuan struck last month.

Three-month aluminium on the London Metal Exchange was down 0.1% at US$1,855 a tonne.

Putrajaya said it would not extend its moratorium on bauxite mining which ends on March 31 due to strong demand for the industry.

Mining giant Glencore has bought 200,000 tonnes of aluminium on the London Metal Exchange and will take delivery of the metal from warehouses owned by ISTIM UK in Port Klang, sources familiar with the matter said.