Sumitomo Corp (8053.T) expects a surplus of 135,000 tonnes in the global aluminium market this year, down from an estimated 1.16 million tonnes in 2008 due to production cuts, data showed on Friday. Japan's third biggest trading firm said it expects global supply in 2009 to amount to 39.17 million tonnes, compared with demand totaling 39.03 million tonnes.
More time is needed for demand to recover after falling sharply from the end of 2008 due to the financial crisis, Sumitomo said in a report.
The automobile and construction industries in particular have been badly hit by the downturn, it said.
Production is thought to have amounted to 40.15 million tonnes in 2008 versus demand for 38.99 million tonnes. It said production cuts would likely continue and deepen in 2009, helping to cut excess supplies. The price of aluminium MAL3, used heavily in transportation and packaging, is currently trading around $1,330 a tonne, the lowest since April 2003.
Earlier this month, China's Shanxi Guanlu (000831.SZ) said it was shutting 40,000 tonnes of aluminium capacity due to low prices and weak demand, despite state purchases of the metal. (Reporting by Miho Yoshikawa; Editing by Brent Kininmont)
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