Japanese Q2 2024 aluminum premium rises to $145-$146.50/mt CIF Japan

Platts, part of S&P Global Commodity Insights, assessed the second-quarter premium for imported primary aluminum at $145-$146.50/mt plus London Metal Exchange cash, CIF main Japanese ports, on April 16, up 61.1%-62.8% from $90/mt in the first quarter of 2024.

The Q2 premium assessment was based on 10 reported trades between March 21 to April 15. Eight deals were concluded at $145/mt with a total volume of 8,000 mt/month, and two at $146.50/mt with a combined 9,000 mt/month, plus LME cash CIF Japan for seaborne P1020/P1020A ingot for loading over April to June.

Offers ranged between $145-$155/mt CIF Japan during negotiations.

A deal at $148/mt for a total volume of 5,000 mt across April-June, equivalent to less than 1,700 mt/month on average, was also reported. This transaction was said to be a bundle deal tied to value-added products (VAP) and was also deemed not repeatable at the time of publication.

The Q2 premium increase was mainly attributed to higher tradable levels in the rest of Asia amid tight supply, despite prevailing weak market fundamentals in Japan. Premiums have been rising in South Korea, China and the broader Asia region.

Platts assessed the CIF main Asian ports (MAP) spot P1020 aluminum premium at $155/mt plus LME cash April 16, unchanged on the day and up $55/mt from the start of 2024.

Asia's near-term outlook is expected to remain bullish amid continued supply tightness in the market despite tepid demand for aluminum from Japan, market participants said.

March aluminum inventory levels in Japan were lower month-on-month and year-on-year. Port stocks at main Japanese ports at the end of March stood at 315,500 mt, down from 330,900 mt on the month and from 370,700 mt a year ago.

On April 16, the Platts CIF Japan spot premium for 99.7% P1020/P1020A aluminum ingot was assessed at $140/mt plus London Metal Exchange cash, CIF Japan, up $2/mt on the day.

Platts specifications are for all quarterly settlements on a CIF main Japanese port basis, negotiated before the quarter between two unaffiliated counterparties, for P1020/P1020A 99.7% primary aluminum ingot, with payment in cash against documents, for volumes of 500 mt/month or more under annual frame contracts.