LONDON: Aluminium edged into positive territory on Friday but was still on track for its worst week since May 2016 as speculative investment flows ebbed on caution over the scale of expected Chinese capacity cuts.

Benchmark aluminium on the London Metal Exchange was bid 0.5 percent higher at $2,103 a tonne after it failed to trade in official rings. The metal used in cans and kitchen utensils fell to its lowest since Sept. 15 on Thursday.

“In China, it looks like the actual policy translation is not as strong as initially expected,” said ETF Securities’ Nitesh Shah, adding that smelters were not cutting as much capacity as initially expected and that was translating into a prices retreat.

The world’s biggest producer of aluminium is expected to cut millions of tonnes of aluminium capacity during the winter to combat air pollution, helping to push prices to five-year highs last month.

Stocks in LME-approved warehouses fell to their lowest since September 2008, down 3,600 tonnes to 1.2 million tonnes. But stocks in Shanghai inched higher this week to a record 666,581 tonnes.

A Reuters poll of 29 analysts this week produced a consensus view that aluminium prices have already peaked. Analysts expect an average 2018 price of $2,038 a tonne.

The dollar index was headed for its biggest weekly drop in four weeks, supporting most metals.

Lead was the only metal on track for a weekly gain, of near 3 percent, as prices hit their highest since Oct. 16 at $2,558 a tonne. LME stocks have fallen to their lowest in almost two years at less than 150,000 tonnes.

Global demand for refined lead will exceed supply by 125,000 tonnes this year, while a deficit of 45,000 tonnes is expected in 2018, according to the International Lead and Zinc Study Group (ILZSG).

Finland’s Terrafame nickel mine is planning to start producing material for electric vehicle batteries by 2020, the company said on Friday.

Copper was up 0.4 percent at $6,834 a tonne in official trading rings after dropping in the previous session to its weakest since Oct. 11 at $6,761.50.

Commodities trader Noble Group reported a third-quarter loss of $1.17 billion, hit by charges from disposals of some of its businesses, and warned that the operating environment remains challenging.

Indonesia’s military on Friday said it was prepared to take tough measures against rebels who have threatened to “destroy” mining operations of Freeport-McMoRan Inc in the eastern province of Papua in their struggle for independence.

Zinc rose 1.8 percent to $3,233 a tonne, lead gained 1.4 percent to $2,550, tin added 1 percent to $19,625 and nickel was up 0.4 percent at $12,345.—Reuters