Key Trends And Indicators In The Aluminum Industry

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Key aluminum industry indicators

The year 2014 has been a remarkable year for  the aluminum industry. Aluminum plays have delivered solid performances on Wall Street. Aluminum prices have also been on an uptrend for most part of the year. This is unlike other metals such as steel and iron ore. Looking at iron ore, its prices have plummeted close to 40% this year. Rio Tinto (RIO) is one of the major iron ore miners. Steel prices have also fallen in global markets. Aluminum truly stands out in the basic material industry.

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What we’ll cover in this series

In this series, we’ll analyze the key indicators that investors in aluminum plays should watch closely. We will analyze recent trends in aluminum prices and premiums. Please be aware that aluminum prices and premiums are key drivers for aluminum companies.

November was an eventful month for aluminum plays

November has been an eventful month for aluminum plays. Century Aluminum (CENX) reached its 52-week high after its 3Q14 results. The spurt in Century’s share price continued, and it made a new 52-week high days later. Currently, it is among the top holdings of the Standard and Poors depositary receipt (or SPDR) S&P Metals and Mining exchange-traded fund (or ETF) (XME).

Constellium (CSTM), on the other hand, fell to its 52-week low after its 3Q14 earnings. Constellium could report lower earnings for several quarters.

Alcoa (AA), the largest aluminum company in the United States, has seen sideways movement in November. It also made a fresh 52-week high in November. Talking about 2014, Alcoa’s share price is up ~60%. The previous chart shows the Wall Street performance of aluminum plays.

Aluminum prices are one of the most important indicators for investors. Let’s analyze the movement in aluminum prices in November.

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