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UPDATE 1-Aluminium producers offer Japanese buyers lower premiums for Q4 shipments -sources

Published 04/09/2018, 05:28 pm
Updated 04/09/2018, 05:30 pm
© Reuters.  UPDATE 1-Aluminium producers offer Japanese buyers lower premiums for Q4 shipments -sources
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TOKYO, Sept 4 (Reuters) - Two global aluminium producers have offered Japanese buyers lower premiums for primary metal shipments for the October to December quarter, two sources directly involved in the pricing talks said on Tuesday.

The producers offered shipments at premiums of $112 and $115 per tonne above the London Metal Exchange (LME) cash price CMAL0 , the sources said. That is down 13 percent to 15 percent from the current quarter.

The offers reflect the weak supply and demand fundamentals in Asia and low spot premiums of below $100 per tonne, the sources said.

The latest quarterly pricing negotiations began last week and are expected to progress during an international industry conference in Berlin next week, the sources said.

"One producer revealed its offer of $112 today," one of the sources said.

A third major producer is likely to reveal its offer next week, the sources said.

Japan is Asia's biggest aluminium importer and the premiums for primary metal shipments it agrees to pay each quarter over LME price set the benchmark for the region.

For the quarter ending in September, Japanese buyers agreed to pay a premium of $132 PREM-ALUM-JP , up 2 percent from the prior quarter on rising spot premiums in the United States. least one of the sources said he believes that none of Japanese buyers would accept the offers given a wide disparity between the current spot premiums.

Major producers include Rio Tinto Ltd RIO.AX , RIO.L , South32 Ltd S32.AX and Alcoa (NYSE:AA) Corp AA.N .

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