According to the assessment of Platts, a subsidiary of S&P Global Commodity Insights, on June 26th, the quoted price of primary aluminium imported to Japan in the third quarter was a premium of $108 per ton over the spot price of the London Metal Exchange (LME), CIF at major Japanese ports. It dropped by 40.66% compared with 182 US dollars per ton in the second quarter.
The assessment of the aluminum premium offer in the third quarter is based on nine transactions reported during the period from May 30 to June 26. All transactions were concluded at a premium price of $108 per ton, with a minimum total trading volume of 14,000 tons per month, applicable to P1020/P1020A seapportioned aluminium ingots from July to September.
The quotation range heard during the negotiation was $130- $145 per ton CIF Japan, which was 20-29% lower than the $182 per ton finally determined in the second quarter.
According to market participants, buyers' expectations for the aluminum premium in the third quarter are $105- $115 per ton.
Market participants said that the demand in the construction industry and the automotive industry has been weak. The United States imposed a 25% tariff on automobiles starting from April 2nd, which affected the demand in the automotive industry. Some market participants said they expected demand to decline further in the coming months due to tariffs.
Meanwhile, the United States raised the aluminum tariff from 25% to 50% starting from June 4th, resulting in a decline in export interest to the US and an overall oversupply in Europe and Asia. Market feedback indicates that, considering a 50% tariff, the replacement cost of goods shipped to the United States is approximately 70 to 75 cents per pound higher than the LME spot price. However, on June 25th, the Midwestern premium for Platts US aluminum spot was 55.55 cents per pound, delivered to the Midwestern region, which was nearly 20 cents per pound lower than the replacement cost.
On June 26th, Platts assessed the premium for spot P1020 aluminum at major Asian ports at $100 per ton, remaining the same as the previous day, but down by $105 per ton compared to the beginning of 2025 and $72 per ton compared to the start of this quarter.
On the supply side, it is expected that two projects will come on stream in the fourth quarter of this year.
Market participants remain bearish on the short-term outlook for Asia. Market participants said that given the expected continued flow of US supply to other markets, the increase in new supply from Indonesia, and the weak demand in Asia, the increase in supply in the region is unlikely to be supported by the premium.
Although some market participants expect the ongoing US-Canada trade negotiations to offer some relief for Canadian aluminium entering the US, others hold a conservative attitude, expecting limited changes in aluminium tariffs.
At the end of May, the port inventory of major ports in Japan was 331,000 tons, increasing by 3.34% month-on-month and decreasing by 6.50% year-on-year.
