European Al ingot premiums pervade downstream contract talks

Customers toward the end of the European aluminium supply chain are now being offered contracts linked to primary ingot premiums, as companies try to mitigate the damage to margins caused by record high premiums this year.

“We’re in discussions in Europe now, trying to promote these contracts,” a producer of aluminium products said. “It’s a new concept for Europe.”
Metal Bulletin’s duty-paid European ingot premium has risen to $260-280 per tonne from $140-175 per tonne at the beginning of the year, while the duty-unpaid figure has reached $195-220 per tonne from $95-120 in the same period. 

With aluminium prices at about $1,850 per tonne this week, the duty-paid premium now accounts for more than 13% of the cost of buying metal, from around 3% back in early 2008. But secondary product prices are still based...

Published

Jethro Wookey

August 23, 2012

15:45 GMT

London