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RIO - Rio Tinto News Story

6535p 58.0  0.9%

Last Trade - 07/05/21

Sector
Basic Materials
Size
Large Cap
Market Cap £105.80bn
Enterprise Value £109.70bn
Revenue £31.93bn
Position in Universe 12th / 1821

UPDATE 1-Japan Q2 aluminium premiums set at 6-yr highs-sources

Wed 31st March, 2021 9:14am
* Q2 premiums rise 14-15% from Q1, marking 3rd quarterly
increase
    * Premiums climb on tight container market, recovering
demand
    * Spot premiums in Japan stand at above $150-$160/T -sources

 (Adds details and quotes)
    By Yuka Obayashi
    TOKYO, March 31 (Reuters) - Premiums for aluminium shipments
to Japanese buyers for April to June were set at $148-$149 a
tonne, the highest in 6 years, on a tight container market and
recovery in demand from a pandemic-induced slump, four sources
involved in pricing talks said.
    Premiums rose 14-15% from this quarter's $130 per tonne,
making this the third straight quarterly increase and the
highest premiums since the same quarter in 2015. Producers'
initial offers were at $149 to $165 per tonne.  urn:newsml:reuters.com:*:nL3N2L21HB 
    Japan is Asia's biggest importer of the light metal and the
premiums  PREM-ALUM-JP  for primary metal shipments it agrees to
pay each quarter over the London Metal Exchange (LME) cash price
 CMAL0  set the benchmark for the region.
    "We have signed contracts with all of producers at $148-$149
a tonne," a source at a Japanese trading house said.
    The higher premiums reflected supply issues and rising
freight costs amid a tight container market and solid demand
from automakers, the source said.
    Container shipping companies have been struggling for months
with disruptions caused by the coronavirus pandemic and a surge
in demand for retail goods that led to wider logistical
bottlenecks around the world.  urn:newsml:reuters.com:*:nL8N2J241R urn:newsml:reuters.com:*:nL1N2LN1SL
    Aluminium stocks at three major Japanese ports
 AL-STK-JPPRT  have been hovering below the key 300,000-tonne
level since October, underlining tightness in the market.
 urn:newsml:reuters.com:*:nFWN2KS02S
    Still, buyers have sought lower levels than producers'
initial offers due to uncertainty over the demand outlook. A
global semiconductor chip shortage has disrupted some
manufacturing activity, with automakers cutting down on
production.  urn:newsml:reuters.com:*:nL3N2L2358 urn:newsml:reuters.com:*:nL1N2LM057
    "We haven't seen a slowdown in orders from automakers and
spot aluminium premiums here are at above $150-$160 a tonne
now," a source at a producer said.
    "But we'll closely watch how the chip shortage will affect
output of automakers next quarter," he said.
    All the sources declined to be identified as they are not
authorised to talk to the media.

 (Reporting by Yuka Obayashi; Editing by Himani Sarkar and Kim
Coghill)
 ((Yuka.Obayashi@thomsonreuters.com; +813-4563-2761;))
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