Aluminium ingot price in Japan to remain stable for Oct-Dec'23

According to Japan Metal Daily, the loading price (base price) of aluminium ingots equipped with large strings, which serves as a crucial indicator for determining the prices of Japanese rolled aluminium products available in retail outlets, has been firmly set at JPY 390 per kilogram (equivalent to $3 per kilogram) for the period spanning from October to December 2023. Notably, this price remains unaltered when compared to the preceding quarter (July-September).

It is significant to mention that the base price had experienced a continuous decline for four consecutive quarters, commencing from a value of JPY 480 during the July-September 2022 period. However, it appears that this downward trend has temporarily stopped.

The pricing dynamics of rolled aluminium products, including plates and extruded materials, are intricately tied to the prevailing rates of aluminium ingots. The base price is predicated upon the average monthly domestic bullion price, which is closely linked to the London Metal Exchange (LME) price, augmented by an additional JPY 10 to account for shipping expenses.

In recent months, domestic aluminium ingot prices have consistently fluctuated within the range of JPY 370 to JPY 390. Hence, market participants had anticipated that the reference price would remain relatively stable.

While it is currently not foreseen that a price revision for rolled aluminium products will be enforced in October 2023 due to the fluctuations in aluminium ingot prices, it is essential to highlight the heightened market sentiment resulting from the implementation of roll margin revisions by select rolling mills.

This revision has already exerted its influence on the prices of both thick and thin sheets within the distribution sector, albeit extruded materials have not yet aligned with this trend. Consequently, it is anticipated that the roll margin adjustments implemented by a subset of rolling mills will continue to exert their influence on market fluctuations in the foreseeable future.

Received under the content exchange agreement with SteelMint