Bloomberg reported that aluminum jumped to the highest level in more than a year in Shanghai on signs of recovering demand in Asia, including China and Japan.

As per report futures in Shanghai have gained 34% and aluminum in London has advanced 29% 2009 as the Dollar Index declined 6.4% against 6 major currencies. The currency index fell for the first time in 5 days boosting the appeal for commodities as a store of value.

Mr Kazuhiko Saito chief analyst at Tokyo based commodity broker Fujitomi Company said that “Compared with other markets, such as equities and oil, base metals looked strong because of the dollar’s weakness. We’ve seen a continued influx of funds in the metals market.”

January delivery aluminum on the Shanghai Futures Exchange gained as much as 2.2% to CNY 15,560 per tonne the highest level since September 26th 2008 and was at CNY 15,385 as of 11:29 AM local time. The metal for delivery in 3 months rose 0.3% to USD 1,990 per tonne on the London Metal Exchange.

According to customs office data, China’s imports of aluminum jumped to 1.4 million tonnes in the first 9 months from 91,274 tonnes in the same period per year earlier.

The Japan Aluminum Association said that Japan’s shipments of aluminum rolled products dropped at the slowest pace in 10 months in September led by a recovery in demand from the auto and electronics industries. Supplies to the domestic and export markets declined 18% to 157,085 tonnes from 192,328 tonnes per year earlier. The pace of the decrease slowed for a seventh month after beginning to drop in October 2008. Shipments plunged 39% in February, the worst slump in 34 years, as recession slashed demand for the metal used in houses and car parts.

(Sourced from Bloomberg)