Shanghai aluminium futures fell 1.8 percent on Wednesday to their lowest since August 2004 on concerns of swelling international stockpiles, and worries China will continue its smelter expansion programme. Shanghai metal fell as much as 285 yuan, or 1.8 percent, to 15,360 yuan ($2,255) soon after the open, after London Metal Exchange stocks jumped by another 3,050 tonnes overnight.
LME aluminium rose $2 to $2,510. Inventories have surged more than 20 percent since mid-August to stand at 1.36 million tonnes, enough for 13 days of world consumption. Shanghai copper futures opened 1.9 percent lower on Wednesday after London prices fell almost 4 percent on worries that the US government's $700 billion answer to the financial market crisis will mire the economy in recession.
The dollar arrested its slide against the euro, slamming the rally in commodities seen since late last week into reverse. Most-active Shanghai December copper fell 1,020 yuan to 53,050 yuan a tonne by 0102 GMT.
London Metal Exchange copper was flat at $6,980, after sliding $270 overnight, But sentiment got a boost from another weighty drawdown in copper stocks. Inventories have fallen nearly 8,000 tonnes this week, mostly as material left warehouses in South Korea, likely boumd for China, suggesting a pick-up in demand in the world's largest consumer of the metal.
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