Global aluminum premiums are expected to reach fresh record highs by mid-2015 on a supply deficit in the US and Europe, a Reuters survey showed.
Premiums have surged this year, more than doubling in the US, as a revival in auto demand spurred aluminum consumption, while smelter shutdowns and use of the metal in financing deals squeezed supply.
But premiums next year will rise at a slower pace as new rules reduce queues at warehouses and as higher all-in prices encourage smelters to ramp up production.
According to the survey of 11 sources from aluminum consumers, producers and trade houses – who declined to be named as they were involved in 2015 term deal talks – global premiums are most likely to hit records in the second quarter.
Chinese aluminum bar had the largest decline on Thursday, December 11, dropping 6.9% and landing at CNY 13,290 ($2,152) per metric ton. The Chinese aluminum cash price flattened at CNY 13,280 ($2,150) following two-days of declines. At CNY 13,600 ($2,202) per metric ton, the price of Chinese aluminum billet was essentially unchanged. The price of Chinese aluminum scrap showed little movement on Thursday at CNY 12,800 ($2,072) per metric ton.
After falling for two days, the aluminum 3-month price rose 0.3% on the LME to $1,965 per metric ton. The primary aluminum cash price is back up, rising by 0.3% on the LME on Thursday to close at $1,950 per metric ton. The Indian aluminum cash price showed little movement on Thursday at INR 122.00 ($1.96) per kilogram.