New York - The premium aluminium buyers in Europe pay to obtain the metal had the sharpest three-month drop in at least 17 years, according to researcher Harbour Aluminium.
The fee added to London Metal Exchange prices dropped to $300 a metric ton as of Thursday, with some “distressed” selling at as low as $250 a ton, according to Jorge Vazquez, managing director at Harbour Aluminium in Austin, Texas. That’s down from $425 to $445 on November 25, and the sharpest three-month drop since the data begins in 1998, Vazquez said.
Falling demand in the region and an increase in the availability of aluminium scrap and primary metal have pushed premiums lower, Vazquez said.
“Europe is where the eye of the storm is, and one of the reasons is because it has the biggest stealth stock in the entire world,” Vazquez said, referring to stockpiles of metal stored outside LME-monitored warehouses.
Supplies are rising because “there are more Russian offers in the market”, Vazquez said.
At the same time, Europe is receiving more offers than usual from China, India, the Middle East, Malaysia and even Mexico, he said.
Bloomberg