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Aluminum Highlights

Week Ending: June 9, 2017An update on industry activity and economic indicators

Getting Trade Right: Addressing Chinese Overcapacity

The domestic aluminum industry is growing – creating American

jobs and committing or investing more than $2 billion since 2013

to expand U.S. manufacturing. But subsidized production in China,

which is leading to unfair and illegal trade practices, threatens the

industry’s continued health.

Demand for lightweight, strong, recyclable aluminum continues to

rise -- up 40 percent since 2009 and approaching record-setting

shipments set in the mid-2000s.

And jobs supported by the U.S. industry are growing -- up 3

percent since 2013 -- while aluminum’s impact on the economy is

up 15 percent – this during a time when many commodities

industries are struggling.

Why?

Because customers are turning to engineered aluminum solutions to make good products great and great products

even better – from more fuel efficient vehicles to sustainable packaging to green buildings. And more growth is on

the horizon – 2015 saw more shipments to the transportation market than at any time in the North American

industry’s 125-year history.

And yet much of this future growth potential is threatened for one key reason – the persistent and dramatic

overcapacity of aluminum in China which is distorting the market and hurting the entire value chain.

Learn more by clicking below:

This report is based on information reported to the Association by participants, which is aggregated by the Association. While the Association believes that its statistical procedures and methods are reliable, it does not warrant the accuracy or completeness of the data. All data contained herein are subject to revision. For further information, contact Ryan Olsen, V.P. Business Information and Statistics at 1-703-358-2984 or email rolsen@aluminum.org. © The Aluminum Association, Inc. All rights reserved.

The Aluminum Association

2Industry Activity

June 9 – The Association’s “Index of Net New Orders of Aluminum Mill Products” for May increased 6.3 percent from the previous month. Orders for flat roll products (sheet, plate, can stock and foil) were up 4.1 percent, while orders for extruded products increased 14.7 percent and orders for redraw rod were up 9.5 percent. Compared to May 2016, orders increased 7.6 percent. On average, orders recorded by domestic producers through the first five months of 2017 were up 3.0 percent over last year.

June 9, 2017

June 10 – The Aluminum Association, in cooperation with the Aluminium Association of Canada, reported primary aluminum productionin North America (U.S. and Canada) was at an annual rate of 3,950,536 tonnes during May 2017, down 15,031 tpy (-0.4%) from the April 2017 rate of 3,965,567 tonnes. The production rate in the U.S. increased 2.9 percent m/m, while the Canadian rate was off 1.1 percent. Compared to a year ago, the North American annual rate was six-tenths of one percent below the May 2016 rate of 3,972,895 tonnes. Actual production through the first five months of 2017 totaled 1,640,433 tonnes, down 3.8 percent from a year ago.

US 12-Mo.

Can. 12-Mo.

The Aluminum Association

3Economic Activity

June 6 – The total number of job openings in the U.S. increased to a series high of 6.0 million on the last business day of April according to the U.S. Bureau of Labor Statistics. Manufacturing job openings fell to 359 thousand, down 11.1 percentfrom March, and off 1.4 percent from a year ago. Hires in the manufacturing sector decreased 5.2 percent, falling off the pace of separations for the first time since Nov. of 2016. Despite the decline, manufacturing hires were still up 18.9 percent from the level reached a year ago. Total hires in April were an estimated 308 thousand, while separations totaled 315 thousand (-0.9%).

June 5 – New orders for manufactured durable goods in April, down following four consecutive monthly increases, decreased $1.8 billion or eight-tenths of one percent to $231.0 billion, as reported by the U.S. Census Bureau. This followed a 2.4 percent March increase (revised). Transportation equipment, down following two consecutive monthly increases, led the decrease (-1.4%). Excluding transportation equipment, April new orders for manufactured durable goods were off five-tenths of one percent m/m. The value of manufacturer's shipments and inventories were down four-tenths of one percent and up two-tenths of one percent m/m in April, respectively.

June 8 – Canadian housing starts decreased 8.8 percent in May, to a seasonally adjusted annual rate (SAAR) of 194,663 units according to the Canadian Mortgage and Housing Corporation (CMHC). This followed a decrease of 15.3 percent in April. The six-month moving average (214,621) increased for the fifth consecutive month. The SAAR of urban starts fell to 178,518 in May, 10.2 percent below the April rate. Multiple urban starts were down 10.8 percent to 118,694 units,while the single-detached urban starts segment decreased to 59,824 units (-8.9%).

June 9, 2017

The Aluminum Association

4Global Trends

June 9, 2017

June 9 – The seasonally adjusted GDP in Mexicoincreased by seven-tenths of one percent during the first quarter of 2017 when compared with the previous quarter, according to an estimate published by the National Institute of Statistics, Geography and Informatics (INEGI). In the third and fourth quarters of 2016, GDP grew by seven-tenths of one percent and 1.1 percent, respectively. Compared with the first quarter of 2016, the seasonally adjusted GDP rose by an estimated 2.6 percent.

June 8 – Seasonally adjusted GDP rose by six-tenths of one percent in both the euro area (EA19) and the EU28 during the first quarter of 2017, compared with the previous quarter, according to an estimate published by Eurostat, the statistical office of the European Union. In the fourth quarter of 2017, GDP grew by five-tenths of one percent and six-tenths of one percent, respectively. Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 1.9 percent in the euro area and by 2.1 percent in the EU28 in the first quarter of 2017, after +1.8 percent and +2.0 percent respectively in the previous quarter.

The Aluminum Association

5Energy

June 9 – According to this week's release by the Federal Reserve Board, the Nominal Broad Dollar Index closed the week at 122.41 on Friday, off two-tenths of one percent from the previous week's close of 122.68. The Index has now declined for five consecutive weeks and has remained below it's 30-day moving average for 21 straight days. Over the last six months, the index is down 3.2 percent, while it's up 1.9 percent over the last 12 months.

The nominal broad dollar index is a weighted average of the foreign exchange values of the U.S. dollar against the currencies of a broad group of major U.S. trading partners.

June 9 – On the NYMEX, near-month WTI crude oil futures (Cushing, OK WTI Future Contract 1) closed the week at $45.83/bbl on Friday, June 9, down $1.83 (-3.8%) from last week's close of $47.66/bbl. Oil prices registered a third-straight weekly loss as an unexpected climb in U.S. crude supplies cast a shadow on efforts to cut global supplies. Active U.S. oil-drilling rigs increased by 8 this week to 741, it's 21st weekly increase in a row. Compared to last year, oil rigs have increased by 413. Brent Crude on London's ICE Futures exchange closed the week down at $48.15/bbl (-4.2%). Friday's spread between the two was $2.32/bbl, down from last week's spread of $2.58/bbl.

June 8 – The U.S. Energy Information Administration reported that natural gas spot prices fell at most locations this report week (Wednesday, May 31 to Wednesday, June 7). The Henry Hub spot price fell from $3.00 per million British thermal units (MMBtu) last Wednesday to $2.99/MMBtu.

At the New York Mercantile Exchange (Nymex), the July 2017 contract price fell 5¢ from $3.071/MMBtu last Wednesday to $3.020/MMBtu.

U.S. Dollar

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The Aluminum Association

6The Aluminum Association, founded in 1933, works globally to aggressively promote aluminum as the most sustainable and recyclable automotive, packaging and construction material in today’s market. The Association represents North America and foreign-based primary producers of aluminum, aluminum recyclers, producers of semi-fabricated products and foundries as well as suppliers to the industry or distributors or jobbers.

The Aluminum Association's statistical programs provide industry information on primary aluminum production, new orders of mill products, industry shipments, end use market estimates, inventories, recycling and foreign trade on a monthly, quarterly and annual basis. Special surveys provide data on specific subjects such as primary capacity, flat roll capacity, inventories and castings shipments. Custom reports are available on a for-fee basis. Web briefings are also available upon request.

Industry OverviewAluminum Statistical Review (Annual Fact Book)Aluminum Highlights (Weekly)Aluminum Situation (Monthly)Summary of Producer Shipments and Inventories (Monthly)

Primary AluminumPrimary Aluminum Production – U.S. and Canada (Monthly)Primary Installed Capacity (Annual)Shipments of Primary Aluminum by Form (Quarterly)

Mill ProductsIndex of Net New Order Receipts for Aluminum Mill Products (Monthly)Can Stock Shipments (Monthly)Electrical Conductor Shipments (Monthly)Extruded Products Shipments and Press Utilization (Monthly)Flat Roll Capacity (Annual)Foil Shipments (Monthly)Forging and Impacts Shipments (Monthly)Rod, Bar, and Wire Shipments (Monthly)Sheet and Plate Shipments (Monthly)

End UseExtrusion Shipments by End Use (Quarterly)Fin Stock Shipments by End Use (Quarterly)Foil Shipments by End Use (Monthly)Sheet and Plate Shipments by End Use (Quarterly)

CastingsU.S. Foundry Castings Shipments (Quarterly)Canada Foundry Castings Shipments (Annual)

RecyclingNew Can Stock (Class) Scrap Receipts (Monthly)Used Beverage Can Reclamation (Annual)

Foreign Trade (based on government customs data)Summary of U.S., Canada and Mexico Imports and Exports (by Commodity), MonthlyForeign Trade Online Database - U.S., Canada and Mexico Exports & Imports of Aluminum (By Commodity, by Country)

For a complete list of statistical publications and reports visit our bookstore.

June 9, 2017