Japanese Q3 2024 aluminum premium rises to $172/mt CIF Japan

Platts, part of S&P Global Commodity Insights, assessed the third-quarter premium for imported primary aluminum at $172/mt plus London Metal Exchange cash, CIF main Japanese ports, on July 22, up 18% from $145-146.50/mt in the second quarter of 2024.

The Q3 premium assessment was based on 10 reported trades between July 16 to July 22. All deals were concluded at $172/mt, with a total minimum volume of 17,000 mt/month, plus LME cash CIF Japan for seaborne P1020/P1020A ingot for loading over July to September.

Offers sat in a range of $172-$190/mt CIF Japan during negotiations.

Some negotiated volumes were heard to be part of bundled or packaged deals, tied to value-added products. However, transacted premiums were heard consistent with the $172/mt for outright P1020 for this quarter.

The Q3 premium increase was mainly attributed to higher tradable levels in the rest of Asia amid tight supply and higher freight costs, despite prevailing weak market fundamentals in Japan. Premiums have also been rising in South Korea, China and the broader Asian continent.

Platts assessed the CIF main Asian ports spot P1020 aluminum premium at $165/mt plus London Metal Exchange cash July 22, unchanged on the day and up $65/mt since 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.

June aluminum inventory levels in Japan were higher month on month but lower year on year. Port stocks at main Japanese ports at the end of May stood at 317,860 mt, up 3% from 308,700 mt a month earlier but down 11% from 357,490 mt in May 2023.

Platts assessed the CIF Japan spot premium for 99.7% P1020/P1020A aluminum ingot was assessed at $170/mt plus London Metal Exchange cash, CIF Japan on July 22, unchanged 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.