Dubal Q2 sales up 5 pct on Asia, Mideast demand

* Dubal Q2 sales up by 5 pct compared to Q2 2008 * Smelter still operating at full capacity of 960,000 tonnes By Amena Bakr DUBAI, Aug. 2 (Reuters) - Dubai Aluminium Co (Dubal) said on Sunday that sales rose 5 percent in the second quarter as demand remained strong in Asia and the Middle East. Sales volumes for the second quarter were 275,055 metric tonnes, compared to 261,972 metric tonnes in the same period last year, state-owned Dubal said in an email to Reuters. "Asia and the Middle East remain our traditional largest markets," it said without giving details on the volume of sales in the two regions. Inventory levels during the second quarter this year were also at the "lowest ever" level, the statement added without giving details on current stock volumes. Dubal said in the statement that its smelter is still running at full capacity of 960,000 metric tonnes a year. "Our projected hot metal production for 2009, based on smelter capacity, is 960,000 metric tonnes. Dubal's entire annual production is made to order and pre-sold," said the statement. Wan Ling, a senior aluminium consultant at CRU International in Hong Kong, said gains in the automotive sector could be driving the move. "Demand for aluminium is improving now, as there is a pick up the auto sector in Asia that's why Dubal might be seeing higher sales," she said. "And since we have seen huge cuts in global production due to the economic conditions, any pick up in demand will have a have a very positive result on sales and lower inventory levels." Dubal said in May that it expected sales to fall 20 percent in the second quarter, amid high global inventories. [ID:nLB597639]. During the first quarter of the year, Dubal's sales fell 30 percent as a result of a slowdown in the automotive sector, Abdulla Kalban, Dubal's chief executive, said at the time. Aluminium producers worldwide have taken about 15 percent of global capacity offline to match the recessionary demand which slowed down automotive and construction sectors. In June, a European alloy supplier to Dubal said that the company had reduced orders of some raw materials by up to 30 percent since the beginning of the year. Regional metal traders estimated that Dubal's primary aluminium output was down around 10 to 15 percent. Dubal said in Sunday's statement that production volumes have not been altered, but alterations were made in the company's product mix. "Changes have been made in line with and to meet market requirements." Aluminium prices fell more than 50 percent to a low of around $1,300 per tonne earlier this year from a peak in 2008 as the economic slowdown cut into demand. The price has since recovered to around $1,800 per tonne. Producers have adjusted their output, but Middle East producers have made only slim reductions as the cost of energy used in the production of the metal is relatively low compared to costs in Europe and the United States. (Editing by Hans Peters)