The chairman of the association Akio Hamaji said the uncertainty over the European economy after Brexit is unlikely to see a strong pickup for aluminium in the global economy. He also added that aluminium supply is expected to exceed demand in the global market this year, which will impact the market.

Benchmark aluminium prices on the London Metal Exchange (LME) have gained 11 percent this year, with recent benchmark numbers hovering around US$1,680 per tonne. Mr Akio, who is also president of Mitsubishi Aluminium, commented on the outlook for Japan’s premiums, stating that they will stay near current levels.

Japan is Asia’s biggest importer of aluminium and the premiums for primary metal shipments it agrees to pay each quarter over the LME cash price set the benchmark for the region. Japanese buyers have agreed to pay producers a premium of US$90 to US$93 per tonne for metal to be shipped in the July to September period, as much as 23 percent less than the previous quarter, on weaker spot premiums.

“Aluminium demand in Japan is steady. But as our government cut its forecast for economic growth, it’s hard to imagine local demand picking up sharply and the premiums jumping from here,” said Mr Akio.

APMEN Sept 2016, News