Premiums for P1020 aluminium in the physical market are at multi-year highs in Asia, the United States and Europe
, with logistical complications and a lack of fresh production keeping supply tight in those regions even as demand remains healthy.
“It’s not that the market will get tighter. It’s not getting tighter, it is very tight already,” a trader in Europe said.
The supply tightness is centered around major aluminium markets, such as the US, Japan and throughout Europe.
Despite 1.8 million tonnes of aluminium sitting in the London Metal Exchange network, over 59% of the stock is confined to Port Klang in Malaysia where there is a significant queue. LME data showed that there was a 183-day wait at Istim warehouses in Port Klang on March 31
High freight rates to ship the metal to major aluminium markets further bolster premiums in those regions.
Fastmarkets’ daily assessment...