GLOBAL ALUMINIUM WRAP: LME contango blocks bearishness, prevents premiums from declining

Wider contangos on the London Metal Exchange helped keep bearish sentiment in the global aluminium market in check this week, with premiums mostly stable to higher on Tuesday June 2.

  • Rotterdam premiums stable as previous concerns fade.
  • South Korean premiums tick up; MJP flat in illiquid conditions.
  • Higher import premiums break Brazil domestic market out of 16-week stasis.
  • US Midwest premium unchanged for two and a half weeks.

Contango eases bearish concerns in Europe
Aluminium premiums in Europe were well supported this week, with market participants feeling more at ease after LME price spreads returned to a stable contango.
Fastmarkets assessed the aluminium P1020A premium, in-whs dp Rotterdam at $100-115 per tonne on Tuesday, unchanged from a week earlier. Most of the liquidity centered on May 29, when deals were reported throughout the range.
A wider contango on the LME’s June/July aluminium spread was said to be one of the main factors supporting the premium. When the spread flipped into a brief backwardation last week, there had been concerns that it could push premiums slightly lower.

Those concerns...

Published

Justin Yang

Karen Ng

Renato Rostás

Michael Roh

June 03, 2020

08:07 GMT

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