Major market developments in November

LONDON, (Reuters) - Despite hefty production cuts in aluminium, more are needed and high and rising visible stocks will continue to weigh on prices into next year, analysts say. "We're seeing stocks rising by several tens of thousands of tonnes almost on a daily basis. Very high inventories bode ill for the next several months," said Calyon analyst Robin Bhar. London Metal Exchange (LME) warehouse stocks might peak around 2.5 to 3.0 million tonnes he said, adding that they tended to keep rising even when the underlying economy was improving. On Thursday, LME inventories stood at 1,903,275 tonnes, their highest in around 14 years. "It's hard to see anything other than a dead cat bounce in aluminium," said Will Adams of Basemetals.com, again citing high stock levels, even though much of this involved "white lining" - putting metal onto warrant which was previously held off-warrant in the same location. Adams said prices might trade in a $1,550-1,650 range in the next month or so. In a recent report Standard Chartered said it expected prices to remain depressed for the foreseeable future. A modest pick-up was predicted from mid-2009, although the stock overhang would continue to dampen any rallies. PRODUCTION: Nov 28 - Workers at Jamaica's largest bauxite and alumina producing company, Alumina Partners, refused a request to indefinitely delay pay increases that were due in January. Nov 26 - Norsk Hydro said "an extreme market" forcing it to consider more production cuts than planned and it would forego investing in a new line at its Karmoy smelter. The board was to consider further "production adjustments" there in December beyond those already announced. The previous week the company said it would reduce production from the old potlines at Karmoy by 20 percent, or by an annual 24,000 tonnes from December. It has since decided to shut 120,000 tpy of Soderberg capacity at Karmoy in Q1 2009. Nov 24 - Bosnia's sole aluminium smelter Aluminij Mostar will cut production and jobs in 2009 because of low prices for the metal and high electricity prices. Nov 24 - Rio Tinto has cut output temporarily by one-third at its Lynemouth aluminium smelter in north-east England. The plant has the capacity to produce around 175,000 tonnes per year (tpy). The idling of capacity described as temporary and the firm hoped to re-open it in 2009. Nov 20 - Rio Tinto's Holyhead primary aluminium smelter in Wales was to return to full production again by the end of November. The Anglesey plant had been operating at a reduced rate since June when a localised fire led to a loss of power. Nov 20 - Madras Aluminium Company Ltd said it has temporarily cut aluminium output by 60 percent. Its alumina refinery, however, continues to operate at optimum capacity. Nov 20 - Daily average primary aluminium output was 70,500 tonnes in October, up from a revised 70,300 tonnes in September, provisional figures from the International Aluminium Institute (IAI) showed. Nov 19 - China's electricity producers have started cutting the fees at which they sell power to aluminium producers, smelter and power sources said, which could help smelters avoid further output cuts and boost flagging demand for electricity. About one million tonnes of aluminium production capacity, including 720,000 tonnes at Chalco <2600.HK> has been shut since Oct. 23. Nov 19 - Three companies aiming to develop an alumina project in Cameroon have formally created a joint venture, Cameroon Alumina Limited, to manage the business. The consortium, comprising Dubai Aluminium of the United Arab Emirates, India's Hindalco Industries and U.S. firm Hydromine, intends to invest $5-6 billion in a bauxite mining and refinery project. Production may begin in 2013. Nov 13 - China produced 11,144,900 tonnes of primary aluminium in the first ten months of the year, up 10.7 percent from a year earlier, National Bureau of Statistics figures showed. Output of alumina rose by 20.4 percent over the same period to reach 19,376,100 tonnes. Nov 12 - Vimetco said it will cut its production in China by a further 15,000 tonnes, in addition to the 80,000 tonnes announced in October. The company also said it may cut production in Romania by as much as 65,000 tpy in 2009. Nov 11 - The annual rate of primary U.S. aluminium production in October was down 2.7 percent year-on-year at 2,561,162 tonnes and was 2.1 percent lower than September's annual rate, the Aluminum Association said. For the year through October, the annual production rate rose by 6.7 percent to 2,703,264 tonnes. Nov 11 - Alcoa Inc has slashed a further 350,000 tonnes of aluminium smelting capacity worldwide, bringing the total amount of tonnage it had taken off line to 615,000 tonnes, or 15 percent of its total capacity. Nov 10 - Rio Tinto Alcan said it will review a $10.6 billion aluminium joint venture with Saudi firm Maaden <1211.SE>, and sources close to the project said it could be delayed by up to two years. Nov 10 - Aluminium production at Rio Tinto's Tiwai Point smelter in New Zealand has been cut by the equivalent of about 280 tonnes per day due to equipment failure. The smelter has capacity to produce up to 350,000 tpy of metal. Nov 10 - Norsk Hydro said its $5.6 billion aluminium smelter in Qatar is on track to start production in late 2009, or early 2010 and all the company's other big projects are also on schedule. Nov 9 - Dubai Aluminium Co (DUBAL) has a production target of 1 million tonnes from 2009, up 4 percent from this year, but may review it due to the global financial crisis. Nov 6 - Aluminium Corp of China Ltd said it had shut down 38 percent of its total alumina capacity. The company also said it had temporarily shut down 720,000 tpy of aluminium capacity. Nov 5 - Trains carrying alumina for export from Guinea's Conakry port resumed following fuel-price protests. Trains from UC RUSAL's Friguia refinery had been stopped temporarily because of the protests. Nov 3 - UC RUSAL said it had suspended production at its Zaporozhye alumina refinery and aluminium smelter in Ukraine. The complex produced 113,000 tonnes of primary aluminium and 265,000 tonnes of alumina a year. PRICES It was downhill more or less all the way for aluminium prices in November, as hefty rises in LME stocks heightened concerns about weaker demand. Market reaction to production cutback announcements was decidedly muted and three-months prices ended the month at $1,775 a tonne froom $2,064 a month earlier. The downtrend continued into early December, with aluminium falling to $1,485 and levels not seen in over five years, although it has since recovered towards $1,500. STOCKS Total exchange stocks were 2,033,668 tonnes at the end of November, up sharply from 1,744,725 tonnes a month earlier. Of that total, 1,823,800 tonnes were held in LME warehouses, compared with 1,528,400 tonnes at the end of September. LME stocks are at their highest level since November 1994. A sizeable proportion of the 295,400 tonne increase last month was thought to be down to movement onto warrant of metal previously tied up in financing deals. Total visible stocks, including latest International Aluminium Institute (IAI) stocks were 3,659,668 tonnes, equating to 33-1/2 days of consumption. Estimated aluminium stocks at the Japanese ports of Yokohama, Nagoya and Osaka totalled 253,500 tonnes in October from a month earlier, an official at Marubeni Corp <8002.T>. The latest figures represented a near 20 percent increase from October 2007, and marked the third straight month of year-on-year rises.