The latest premium bid for Japan’s Q3 aluminium shipments is even higher than Q2

According to a report on June 18, some global aluminium producers sought a premium of $185-190 per tonne from Japanese buyers for July-September primary aluminium shipments. The news came after three people directly involved in quarterly pricing talks said.

Compared to the second quarter’s premium of $145-148 per tonne, the Q3 premium being offered is 25 to 31 per cent higher.

The latest Q3 premium is even higher than the premium quoted last month by a global producer. According to a report on May 29, Japanese buyers were offered a premium of $175 per tonne, up 18 to 20 per cent from the Q2 premium.

During the previous offer, Japanese buyers had already expressed that the premium was too high considering the sluggish domestic demand for aluminium, especially from the industrial and construction sectors. Japan is Asia's most prominent importer of primary aluminium; thus, the premium it agrees to pay each quarter over the London Metal Exchange price becomes a benchmark for the region.

A source said earlier that the continuous rise in premiums could be attributed to tighter supply in Asia caused by strong demand from European customers.

Last week, Marubeni Corporation, a Japanese integrated trading and investment business conglomerate, reported that aluminium stocks at Japan’s three major ports in May 2024 stood steady M-o-M at 308,100 tonnes, compared to 308,700 tonnes, but marked a plunge of 12.8 per cent from 354,000 tonnes.