A5 aluminum: USD/ton 5-15;

A6 aluminum: USD/ton 10-25;

A7 aluminum: USD/ton 15-30.

Outlooks for aluminum market

Opinions on average prices for aluminum in 2001 voiced by
the primary world experts vary considerably: the forecast figures fluctuate within USD/ton
1,540 and 1,760. However, it is more likely that the average price for this metal will
settle somewhere in between USD/ton 1,580 and 1,620.

Copper

In the first two months of 2001, prices for copper were
stable at USD/ton 1,700-1,800, whereas at the beginning of March, they began to grow
reaching USD/ton 1,824 on March 5. However, at this time, market operators were worried
with the economic recession in the USA. As a result, copper consumers purchased only small
batches of this metal waiting for a further price reduction.

European consumers paid close attention to China, which
came back to the market after celebration of the Chinese New Year, but no significant
events took place. Chinese copper producers kept their import quota at 800 ths. tons for
copper concentrate and 200 ths. tons for copper anodes. In 2000, China imported 1.8 mln.
tons of copper concentrate and anodes, whereas in January-February, it exported 125 ths.
tons of these raw materials. This situation became possible after introduction of 13% VAT
repayment to the primary copper producers in China, which made Chinese copper competitive
on the domestic market and substantially undermined copper imports to this country.

This statement is supported by the following figures. In
January, China imported only 24.1 ths. tons of copper, which was 27% less than it did in
January 2000 and 42% less than in the previous month. At the same time, copper output in
China totaled 106.4 ths. tons in January, which corresponded to a 10% increment from the
figure reported in January 2000.

Premiums for “A” copper were as follows in
February-March 2001:

in Shanghai – USD/ton 54-55;

in Liverpool and Livorno – USD/ton 36-38;

in Rotterdam – USD/ton 20;

in Dunkerk – USD/ton 40.

Premiums for copper of CIS origin, in particular, in
Russia, Rotterdam, and Hamburg, were around USD/ton

10-15.

As concerns the general situation on the copper market, it
is possible to state that beginning with the 2-nd quarter of 2000, this market is
indicating a shortage of copper, which may continue up to the 3-rd quarter of 2001. After
the period of growing copper supplies to Western countries, primarily from Latin America,
at the end of the 1990s, new productive capacities are now dwindling. In addition, the
copper market is still experiencing consequences of rationalization of copper production
in the USA in 1999. A number of copper-producing enterprises are likely to shut down,
because the present situation in the industry is now similar to that in aluminum industry,
which has lost a portion of its productive capacities, owing to high energy expenditures.

Outlooks for copper market

Experts’ price forecast for 2001 is rather too
optimistic. Leading analysts say the average price for copper will come to USD/ton
2,100-2,200 this year. However, this forecast can come true only if the market situation
develops in the most favorable manner. Taking into account the economic situation in the
USA, Japan, and primary European countries, there are not many reasons for such optimistic
forecast. The figure of USD/ton 1,750-1,850 seems to be more realistic for the current
year.

UKRAINE

Foreign trade

In January-February 2001, non-ferrous exports from Ukraine
totaled 80.7 ths. tons worth USD 127.6 mln. As compared with the figure registered in the
corresponding period of 2000, physical exports decreased by 18.3%, whereas export revenues
added 22.27%. In January-February 2000, these figures were respectively equal to 98.7 ths.
tons and USD 104.4 mln.

According to reports of January-February 2001, copper and
aluminum collectively accounted for 85% of physical non-ferrous exports from Ukraine and
for 79.5% of the aggregate non-ferrous export revenues.

In terms of quantitative indicators, aluminum and copper
exports dropped by 24.3% in January-February 2001 and revenues, in turn, went 7.3% down.

Export supplies of nickel, lead, zinc, and tin came to the
aggregate 1.25 ths. tons worth USD 1.2 mln., i. e. 1.55% and 0.94% of the total
non-ferrous export figures respectively. For comparison, physical exports of the indicated
metals and revenues from them totaled 1,630 tons worth USD 0.8 mln. in January-February
2000.

It is worth pointing out that in January-February 2000,
export supplies of other non-ferrous metals, metal ceramics and their products totaled 5.2
ths. tons for the sum of USD 5.8 mln., whereas 8.8 ths. tons of the indicated commodities
worth USD 7.8 mln. were exported in January-February 2001. The corresponding increments of
the respective figures came to 70.17% and 33.9%. This category of non-ferrous metals
accounted for 11% (quantity) and 6.1% (revenues) of the total non-ferrous exports in
January-February 2001.

Copper group

In the first two months of 2001, Ukraine exported 18.3 ths.
tons of copper and copper products worth USD 30.4 mln. In comparison with the
corresponding 2000’ period, the quantitative figure decreased by nearly 4%, whereas
export revenues in this metal group jumped 63.2%.

The main exported copper articles still are unrefined
copper ingots and refined copper and copper-based alloys.

Crude copper exports in January-February 2001 totaled 5.3
ths. tons worth USD 8.6 mln. In the same period, exports of refined copper and
copper-based alloys added up to 11.6 ths. tons for the total sum of USD 19.6 mln. The
share of this commodity group in the total copper exports came to 92.8% in terms of both
exported quantity and export revenues.

The increments of export supplies in this subgroup (refined
copper and copper-based alloys) were 59% in quantity and 177% in revenues in the report
period of 2001, against the figures reported in January-February 2000.

Aluminum group

Commodities of this group were leaders in non-ferrous
exports from Ukraine at the beginning of 2001.

In January-February 2001, Ukraine exported 50.3 ths. tons
of aluminum commodities worth USD 71 mln. These indicators lowered against the
corresponding 2000’ figures by 29.3% and 6.5% respectively.

Aluminum group accounted for 62.4% in the total non-ferrous
exports in terms of quantity and for 55.7% of the total revenues from non-ferrous exports
in 2000.

Just as before, the primary exported articles were primary
aluminum and aluminum-based alloys in ingots, which collectively account for 85.3% in the
total aluminum exports. The total of 46.4 ths. tons of the indicated commodities worth USD
60.6 mln. were exported in the report period of 2001.

Overview of export supplies

The following commodities accounted for the largest export
figures in January-February 2001:

- crude aluminum and aluminum-based alloys – 46.6 ths.
tons (62.4% of the total) worth USD 60.6 mln. (55.7%);

- refined copper and copper-based alloys – 11.6 ths. tons
(14.4%) worth USD 19.6 mln. (15.4%).

Vyacheslav POPOV, expert with Derzhzovnishinform

Table 1. LME quotations for aluminum in 1999-2001
(January-March), USD/MT

* Hereinafter, prices of future contracts, which foresee supplies in 3
months.

Table 2. Average LME prices for aluminum in 1995-2001
(January-March), USD/MT

Table 3. Average LME prices for А380.1 aluminum
alloy in 1995-2001 (January-March), USD/MT

Table 4. LME quotations of aluminum alloy А380.1 in
1999-2001 (January-March), USD/MT

Table 5. Dynamics of LME prices for aluminum in
1999-2001 (January-March), USD/MT

Table 6. Dynamics of LME prices for aluminum alloy
А380.1 in 1999-2001 (January-March), USD/MT

Table 7. LME quotations for copper in 1999-2001
(January-March), USD/MT

Table 8. Dynamics of LME prices for copper in
1999-2001 (January-March), USD/MT

Table 9. Average LME prices for copper in 1995-2001,
USD/MT

Table 10. Export dynamics of non-ferrous metals and
products in 2000-2001 (January-February)

Table 11. Main articles of Ukrainian export of copper
and products in 2000-2001 (January-February).

Table 12. Main importers of Ukrainian copper and
products in January-February 2001

Table 13. Main articles of Ukrainian export of
aluminum and products in 2000-2001 (January-February).

Table 14. Main importers of Ukrainian aluminum and
products in January-February 2001