Goldman Sachs has to lift the expectation for aluminum price from 1.3 US dollars to 1.39 US dollars per pound for 2008 due to Chalco-led output cut.

     It also raised the prediction for 2009 from 1.32 US dollars to 1.6 US dollars per pound, and 1.25 US dollars to 1.45 US dollars for 2010.

     China's biggest aluminum producer Chalco (601600.SH; 2600.HK) on July 10 agreed to cut the output by 10 percent in partnership with some of its peers. It is estimated to reduce China's aluminum output by 400,000 tons for the second half of the year. This pulled up LME aluminum price to hit record high.

     Goldman Sachs analyst reduced global aluminum supply estimation from 275,000 tons to 62,000 tons for 2008 due to power shortage in China and South Africa.

     Goldman Sachs forecast that China's aluminum consumption would rise 20 percent next year and 15 percent in 2010. Supply insufficiency is likely to appear.

     Chalco A shares kept falling for three days after its decision on output cut, closing at 12.88 yuan Wednesday, down 6.33 percent. Its H shares went up 0.363 percent to end at 8.3 HK dollars.