CHICAGO Bullish sentiment
about Midwest aluminum spot premiums doesnt appear to
have translated into higher prices yet.
Several market sources reported
P1020 aluminum premiums in a range of 11.5 to 12 cents per
pound, but most havent booked any business at that level
this week. As a result, AMMs premiums remain in
a range of 11.3 to 12 cents per pound despite some sources
insisting that prices are on the rise.
One trader said that his company
had booked business in a range of 11.5 to 12 cents per pound
last week but not this week.
Another market source said he
was aware of 250,000 to 300,000 pounds booked in the same range
but hadnt transacted the business himself.
A producer source also said his
company was turning away spot business unless the premium was
at least 11.5 to 11.75 cents per pound. "Well make
something happen at that price," he said.
The producer source wasnt
aware of any spot deals being booked at 11.5 to 11.75 cents per
pound, but said his company felt no compulsion to take
lower-priced deals, given a comfortable load of contract
The trader said he was "mildly
bullish," given limited availability thanks not so much to
material going into warehouses but increased demand from the
physical market, including a strong automotive sector and an
uptick in building and construction activity.
Premiums were pointing up as
activity improves heading into the spring and as traders short
metal are bidding up premiums, according to one market
observer, who hadnt conducted any transactions for metal.
Also bolstering premiums is fear of a potential supply
disruption resulting from power rate disagreements between
Henderson, Ky.-based Big Rivers Electric Corp. and Rio Tinto
Alcans Sebree, Ky., smelter and Century Aluminum
Co.s Hawesville, Ky., facility (
amm.com, Feb. 4), he said.
But while some sources said the
market was inching upward, others said it was flat and spot
activity was limited.
"Its pretty much the same"
as last week, a second trader said. His company had conducted
several smaller deals at premiums of 14 cents or more per
pound, he said, but acknowledged that they might not be
representative of the overall market, given their size, and
because his company sometimes conducts business with customers
who are more sensitive to just-in-time requirements than