Market View. Aluminum Highlights. Aluminum Demand Grows for 6 th Consecutive Year

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1 Market View Aluminum Highlights Week Ending: An update on Industry activity and economic indicators By: Paul Williams, Head of Aluminium CRU Analysis The views expressed in the Market View are those of the author and do not necessarily represent the views of the Aluminum Association As we enter the new year, the aluminum price has been moving lower, and at the time of writing the three month price had dipped below $1700/t. The decline in the LME price comes as downward pressure on the SHFE price in China intensifies. Since early December, the SHFE cash price has declined from RMB15385/t from the middle of December to RMB12765/t by end December. Restarts of primary aluminum capacity plus ramp ups of new capacity are accelerating the growth of production in China at the moment. CRU expects Chinese primary production will grow by 9% in This comes at a time when demand growth is easing and the market is entering the seasonally quieter China Lunar newyear period. Indeed, the latest pronouncements from China indicate that the government will not be worried by slightly lower economic growth and that it will continue to take measures to cool the property market. Reported inventory levels in China are starting to rise as well, as logistical bottlenecks begin to ease, although they are likely to stay reasonably tight until mid February. Nonetheless, CRU expects inventory levels will continue to rise in China over the next three months. Aluminum Demand Grows for 6 th Consecutive Year The latest edition of the Aluminum Statistical Review for 2015 includes statistics on every aspect of the North American aluminum industry From primary aluminum production, to foreign trade, to end use markets, to the recovery of aluminum scrap. And, for the first time, the full report is available for free to producer members of the Aluminum Association by clicking here: Aluminum Statistical Review Producer. The report is also available for purchase in the Aluminum Association bookstore. 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 or rolsen@aluminum.org., Inc. All rights reserved. Follow us on:

2 Industry Activity 2 December 19 Estimated shipments of Aluminum Drawing Stock, Bare Wire and Rod & Bar by U.S. and Canadian producers totaled 98.5 million pounds during November 2016, an increase of 3.3 percent over the November 2015 total of 95.4 million pounds. Compared to the previous month, shipments rose eight tenths of one percent over the October 2016 total of 97.7 million pounds. Year to date shipments through November 2016 totaled 1,095.4 million pounds, off six tenths of one percent from the year to date 2015 total of 1,101.7 million pounds. December 19 Shipments of Aluminum Powder and Paste to domestic markets by domestic producers, including imports by domestic producers, totaled 6.48 million pounds during November 2016, a decrease of 9.8 percent from the November 2015 total of 7.18 million pounds. Compared to the previous month, shipments increased 17.9 percent over the October 2016 total of 5.50 million pounds. Year to date shipments through November 2016 totaled million pounds, off 19.7 percent from the year todate 2016 total of million pounds. Compared to November 2015, shipments of powder to domestic markets were down 11.2 percent to 5.57 million pounds, while shipments of paste rose three tenths of one percent to 0.91 million pounds. December 19 Shipments of Aluminum Extruded Products (extruded shapes, pipe & tube, and rod & bar) by U.S. and Canadian producers totaled an estimated million pounds during November 2016, a rise of 3.7 percent over the November 2015 total of million pounds. Compared to the previous month, shipments decreased 7.0 percent from the October 2016 total of million pounds. Year to date shipments through November 2016 totaled 4,821.7 million pounds, up 1.3 percent over the year to date 2015 total of 4,758.8 million pounds.

3 Industry Activity Cont 3 December 19 Estimated shipments of Aluminum Forgings and Impacts by U.S. and Canadian producers totaled 25.2 million pounds during November 2016, down 1.1 percent from the November 2015 total of 25.5 million pounds. Compared to the previous month, shipments decreased 5.1 percent from the October 2016 total of 26.6 million pounds. Year to date shipments through November 2016 totaled million pounds, off 5.7 percent from the 2015 year to date total of million pounds. December 23 Preliminary estimates indicate that aluminum demand in the United States and Canada (shipments by domestic producers plus imports) totaled an estimated 22,120 million pounds through October of 2016, up 1.6 percent over the same period last year. Demand for semifabricated (mill) products totaled 15,531 million pounds, down two tenths of one percent. Apparent consumption (demand less exports) in domestic markets totaled an estimated 19,487 million pounds, up six tenths of one percent yearto date. December 30 Aluminum net shipments (including exports) by domestic U.S. and Canadian facilities totaled an estimated 1,931 million pounds during November, up 4.5 percent over the November 2015 total of 1,847 million pounds. Shipments of aluminum mill products increased 3.0 percent over the previous year to 1,256 million pounds, while shipments of aluminum ingot for castings, exports and destructive uses increased by 7.5 percent year over year, totaling 674 million pounds. Preliminary producer shipments through November 2016 totaled 21,711 million pounds, up 1.9 percent over the same period last year. November inventory levels totaled an estimated 2,796 million pounds, down 3.5 percent from the previous month and down 7.1 percent year overyear.

4 Economic Activity 4 December 22 U.S. real gross domestic product increased at an annual rate of 3.5 percent in the third quarter of 2016 according to the "Third" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 1.4 percent. BEA emphasized that the "third" estimate is based on more complete source data than were available for the "second" estimate issued last month. In the second estimate, the increase in real GDP was 3.2 percent. With this third estimate for the third quarter, nonresidential fixed investment, personal consumption expenditures (PCE), and state and local government spending increased more than previously estimated, but the general picture of economic growth remains the same. December 23 Sales of new single family houses in November 2016 were at a seasonally adjusted annual rate of 592,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 5.2 percent above the revised October rate of 563,000 and is 16.5 percent above the November 2015 estimate of 508,000. The median sales price of new houses sold in November 2016 was $305,400; the average sales price was $359,900. December 23 Statistics Canada report that real GDP in Canada decreased three tenths of one percent in October, following afour tenths of one percent increase in September. The output of goods producing industries contracted by 1.3 percent, while service producing industries edged up one tenth of one percent. Total manufacturing output decreased 2.0 percent, as both durable and non durable goods manufacturing decreased. Durable goods manufacturing was off 2.1 percent, as almost all industrial groups were down, with the largest declines in terms of output registered in machinery, fabricated metal products and primary metal manufacturing.

5 Economic Activity Cont 5 December 29 In the week ending December 24, the advance figure for seasonally adjusted initial claims of unemployment insurance was 265,000, a decrease of 10,000 from the previous week's unrevised level of 275,000 according to the U.S. Department of Labor's Employment and Training Administration. The 4 week moving average was 263,000, a decrease of 750 from the previous week's revised average of 263,750. There were no special factors impacting this week's initial claims. This marks 95 consecutive weeks of initial claims below 300,000, the longest streak since An initial claim is a claim filed by an unemployed individual after a separation from an employer. Global Trends December 20 According to data collected by the International Aluminium Institute and the Aluminum Association, global primary aluminum production was at an annual rate of 61.0 million tonnes during November 2016, up 3.7 percent over the October 2016 rate of 58.9 million tonnes. Annual production in North America (U.S. and Canada) was unchanged from October, and down 11.3 percent Y/Y. In China, the annual rate of production was up 6.1 percent over October, and up 4.6 percent Y/Y. In the Rest Of the World, the annual production rate reached 22.9 million tonnes in November, up 4.0 percent over a year ago. Through November 2016, actual global production totaled an estimated 53.0 million tonnes, a decrease of two tenths of one percent from the same period in 2015.

6 Energy 6 December 22 The U.S. Energy Information Administration reported that natural gas spot prices fell at most locations this report week (Wednesday, December 14 to Wednesday, December 21). The Henry Hub spot price fell from $3.52 per million British thermal units (MMBtu) last Wednesday to $3.48/MMBtu. At the New York Mercantile Exchange (Nymex), the January 2017 contract remained flat Wednesday to Wednesday at $3.542/MMBtu. December 30 On the NYMEX, near month WTI crude oil futures (Cushing, OK WTI Future Contract 1) closed the week at $53.72/bbl on Friday, December 30, up $0.70 (+1.3%) from last week's close of $53.02/bbl. Crude oil prices saw a nearly 45 percent calendar year rise and a more than 8 percent jump in December, fueled in part by expectations members of the Organization of the Petroleum Exporting Countries and other major producers will abide by an agreement to curb output. Active U.S. oil drilling rigs were up 2 this week to 525. Compared to last year, oil rigs have fallen by 11. Brent Crude on London's ICE Futures exchange also closed the week up at $56.82/bbl (+3.0%). Friday's spread between the two was $3.10/bbl, up from last week's close of $2.14/bbl. U.S. Dollar December 30 Federal offices were closed on January 2, 2017 in observance of New Years Day. Our weekly update of the Nominal Broad Dollar Index will resume next week. Last week, the Index closed at , up threetenths of one percent over the Friday, December 16 close of Over the last six months, the index is up 7.3 percent, while it's up 4.9 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.

7 , 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. 7 '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 Overview Aluminum Statistical Review (Annual Fact Book) Aluminum Highlights (Weekly) Aluminum Situation (Monthly) Summary of Producer Shipments and Inventories (Monthly) Primary Aluminum Primary Aluminum Production U.S. and Canada (Monthly) Primary Installed Capacity (Annual) Shipments of Primary Aluminum by Form (Quarterly) Mill Products Index 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 Use Extrusion 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) Castings U.S. Foundry Castings Shipments (Quarterly) Canada Foundry Castings Shipments (Annual) Recycling New 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), Monthly Foreign 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.