Glencore cuts Century Aluminum stake to 33% after tariff-driven rally

By Pratima Desai

LONDON (Reuters) -Glencore has chopped its involvement successful Century Aluminum by 10% to 33%, raking successful millions pursuing a stock terms rally ​triggered by U.S. tariffs connected aluminium imports and a nett bonanza for section aluminium ‌smelters.

U.S. President Donald Trump doubled tariffs connected aluminium imports to 50% connected June 4 with the purpose of incentivising concern ‌in accumulation of the metallic successful the United States.

London-listed Glencore is Century's largest shareholder. It supplies Century with alumina, a feedstock for aluminium, portion buying astir each of its North American aluminium accumulation for U.S. customers.

It sold 9 cardinal shares of its 40 cardinal holding connected November 10 for $272.⁠25 cardinal and converted each of ‌its Series A Convertible Preferred Stock into 4.95 cardinal mean shares, according to a regulatory filing successful the United States.

CONFIDENCE IN CENTURY'S MANAGEMENT

Century's banal was ‍trading astir $28 connected Monday and is up 80% since June owed to soaring U.S. aluminium prices arsenic the marketplace priced successful the tariff and the inducement needed for producers to support shipping to the United States.

Glencore's ​transactions permission it holding astir 36 cardinal shares, equating to astir 33% of Century's equity,‌ down from 43% previously. The commodity trader and miner has had a involvement successful Century for astir 30 years.

In different regulatory filing, Glencore said it remained assured successful Century's absorption squad and that it had taken "action to monetise" a information of its investment.

Century is the largest superior aluminium shaper successful the United States wherever past twelvemonth it produced 690,000 metric tons of the metallic utilized ⁠in the operation arsenic good arsenic powerfulness and packaging industries.

The United ​States relies connected aluminium imports, which past twelvemonth amounted to ​3.94 cardinal tons, according to accusation supplier Trade Data Monitor.

For producers to support shipping aluminium to the United States, the prices they complaint request to screen the ‍tariff.

Consumers successful the United States ⁠buying aluminium connected the carnal marketplace wage the benchmark terms connected the London Metal Exchange positive the Midwest premium that covers costs specified arsenic freight and taxes.

LME aluminium touched $2,920 connected ⁠November 3, the highest since May, partially owed to choky markets portion the U.S. premium deed a grounds ‌88.21 U.S. cents per lb oregon $1,944 a ton past week.

(Reporting ‌by Pratima Desai; Editing by Emelia Sithole-Matarise)