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RusAl sees aluminum upside in 2011

United Company RusAl said that aluminum prices were bottoming out and that a very significant recovery was expected in 2011. Mr Artyom Volynets director of corporate strategy in an interview after a presentation to analysts in London said that aluminum prices, currently at about USD 1,420 per tonne would remain volatile this year before rising USD 200 to USD 300 in 2010 ahead of a big improvement in 2011.Mr Volynets said that "It feels very bad now, but it also means that we shall start seeing the light at the end of the tunnel because we are finding a bottom. If the production costs were to stay at last year's levels, none of the global smelters would be profitable."

In February at the World Economic Forum in Davos, Mr Deripaska said he expected aluminum prices to average USD 1,600 per ton over the next seven years, shortly after Mr Viktor Vekselberg chairman of RusAl said that he was 100% sure that the price per ton could hit USD 2,000 by the end of the year.

Mr Volynets said that London Metal Exchange inventories now at record levels above 3.4 million tonnes are set to peak in the third quarter before falling as industry cutbacks take effect adding that 17% of global aluminum capacity had already been cut. He said that "We are open to the possibilities of making further cuts, but that all depends on global demand and the supply situation. We may consider bringing our production cuts up to 20% but the decision has not been made."

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