Premiums for aluminum in Asia are set to slip from record highs as China ramps up exports of semi-manufactured products, leaving regional producers searching for buyers for their surplus metal.
Premiums, the surcharge for obtaining physical metal, have nearly doubled in the past two years outside of China after Western producers cut supply due to years of low prices.
A backlog at London Metal Exchange warehouses and financing demand from Western banks earning profit on stored metal also tightened supply.
Korean 1050 aluminum sheet finished as the week’s biggest mover on the weekly Aluminum MMI® after dropping 4.5% and landing at KRW 3,786 ($3.41) per kilogram. At KRW 3,836 ($3.46) per kilogram, the price of Korean 3003 coil premium over 1050 sheet finished the week down 4.4%. The price of Korean 5052 coil premium over 1050 sheet fell 4.3% over the past week to KRW 3,986 ($3.59) per kilogram. This was the third week in a row of declining prices. European 5083 plate prices held steady from the previous week at EUR 2,897 ($3,279) per metric ton.
Chinese aluminum prices were up for the week. The price of Chinese aluminum billet rose 1.3% to CNY 12,940 ($2,069) per metric ton after falling 3.2% during the previous week. The cash price of Chinese aluminum rose 1.1% to CNY 12,910 ($2,064) per metric ton after falling 1.8% during the previous week. At CNY 13,700 ($2,191) per metric ton, the price of Chinese aluminum bar finished the week 1.0% higher.
The cash price of primary Indian aluminum closed last week at INR 112.60 ($1.81) per kilogram, after a 1.5% drop. With a 0.8% decrease on the LME, the primary aluminum cash price closed the week at $1,797 per metric ton. The aluminum 3-month price saw a 0.7% drop this week on the LME, closing at $1,819 per metric ton.
The Aluminum MMI® collects and weights 12 global aluminum price points to provide a unique view into aluminum price trends. For more information on the Aluminum MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.