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Shares of aluminum companies fell today as investors
concluded that the commodity's recent price
decline has now sunk beneath the marginal cost
of production and fears mounted of falling demand
from Chinese buyers. The commodity closed Wednesday
at 85.6 cents per pound for November delivery.
That was down from Monday's close of 86.35 cents--
its lowest level in three years. "Once aluminum
falls to the 80-cents-per-pound range, it has
fallen below the marginal cost of production."
Analysts noted that aluminum is coming off a
high of about $1.50 per pound reached in June,
also said the commodity markets are concerned
about China's declining growth rate.
Trade Reports November 2008
Sector roundup: Aluminum suppliers. Sector roundup:
Shares sink as bailout hopes dwindle; aluminum
suppliers down. Shares of aluminum companies
sank today after the spot price of the commodity
closed near a three-year low and an analyst
revised an estimate for Alcoa Inc. from a profit
to a loss and downgraded Century Aluminum's
shares.
Financial News November 2008
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Sector Snap: Aluminum companies struggling.
Shares of aluminum companies sank today after
the spot price of the commodity closed near
a 52-week low, with little apparent prospect
for a near-term rally. The price of aluminum
closed Monday at 86.35 cents per pound -- an
all-time record low for November -- and ended
Tuesday only slightly higher at 87.1 cents per
pound.
Trade Analysts November 2008
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Shoring up
sales in tough times
A Wisconsin firm boosts its profits
by offering top clients some tender
loving care.
One expert encourages reps to devote
more time to developing relationships
with their best existing clients. Follow
that advice to the letter and you will
be pleased with the results.
Take time to ask questions on the
phone with clients, note that the company
will also occasionally absorb costs,
even those resulting from an outside
mistake, in order to maintain good will.
That's gained more business and even
some referrals to new customers.
"We've tried to build friendships, and
that's paid off,"
From Packaging Business News
advice site
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Aluminum Falls to Two-Year Low on Slowdown.
Aluminum declined to a two-year low on signs
that demand is slowing in the U.S. Aluminum,
which rose 38 percent until July this year,
has since erased all its gains as manufacturing
shrinks in the U.S. and parts of Europe. Alcoa
Inc., the largest U.S. aluminum producer, said
last week it would halt remaining production
at its Rockdale, Texas, smelter. Aluminum is
going to be tested significantly over the next
quarter to see whether marginal producers can
make any money. Aluminum may be supported because
production costs are so much higher than selling
prices.
News Wires
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Pepsi on
sustainability
Pepsi Bottling Group Inc. released a
corporate responsibility report this
week, and plastics play a pretty major
role in the story. The company highlights
its efforts to make bottles lighter,
and also to bring bottle manufacturing
in-house. (Click
here to download the full report,
in PDF format). The report includes
a story quoting Walter Samylenko, director
of packaging engineering, about the
company's efforts to use less plastics
through lightweighting.
Read - XP PreStretched Film
Read - HYBRiD80 Stretch Films
Trade News Report October 2008 |
Commodities headed for their worst month since
at least 1956 on concern that a slump in global
economic growth will sap demand for raw materials.
On the London Metal Exchange, Aluminum fell
$40, or 1.9 percent, to $2,020, down 17 percent
for October. The world's central banks are cutting
borrowing costs as the financial crisis that
started with the U.S. housing slump threatens
to tip the global economy into recession. Analysts
cut forecasts for global growth next year to
1.3 percent, from 2.2 percent, prompting a reduction
of as much as 48 percent in its 2009 forecasts
for commodities.
Trade Reports
One positive is that a stronger dollar helps
cut the cost of commodities: steel, copper,
aluminum and oil are much cheaper than just
a few weeks ago. But since that retreat reflects
expectations of weakness, it is not unalloyed
good news.
Trade Commentator
Tumbling prices for energy and metals led commodities
to their lowest since September 2004 on signs
of plunging demand for raw materials as the
U.S. economy slows. Global conditions are no
longer commodity-supportive," analysts report
"Demand for commodities is already suffering
and we expect further weakness."
News Wires
As a global economic slowdown crimps demand
for virtually every commodity, aluminum prices
have dropped 32 percent from an all-time high
in July. Analysts said the fall reflect weak
demand in ailing sectors like the auto industry
and commercial building, and that prices will
likely remain low for some time. "Given massive
inventory builds, recovery is unlikely before
mid-09.
News Wires
Truckers pushed through some fairly large price
hikes in 2008 as cost pressures continue to
accelerate. Overall, the industry lifted average
transaction prices 0.8% from a month ago. Prices
were also up 5.1% from the same month a year
ago, which was the largest inflation jump since
December 2005. Long-distance LTL carriers drove
the hardest bargain with a 9.2% price hike.
Trade News
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