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Alcoa said lower prices for its metal-making ingredients will help to lower production costs in the second quarter as aluminum demand stays robust.

Earnings will get a boost in the second quarter from “favorable raw materials, volume and lower production costs,” the Pittsburgh-based company said in a statement Wednesday.

Alcoa reiterated its outlook for 2023 aluminum shipments at between 2.5 million and 2.6 million tons.

Aluminum prices are up just over 2% in 2023 as demand for the lightweight metal remained steady in the face of headwinds including higher borrowing rates, fears of China’s slow return from Covid lockdowns and growing concerns that economic activity could slow in the US. Analysts at Citigroup have said they expect strong aluminum prices of as high as $3 000 a ton by year end, or roughly 20% higher than current levels.

In the first quarter, Alcoa posted an unexpected adjusted loss of 23 cents per share. Analysts had expected a profit of 3.1 cents per share.