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UPDATE 1-Aluminium producers seek Q4 premiums of as low as $100/T - sources

Published 04/09/2017, 07:44 pm
Updated 04/09/2017, 07:50 pm
© Reuters.  UPDATE 1-Aluminium producers seek Q4 premiums of as low as $100/T - sources
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* Producers' Q4 offers are down from $118-119/T in Q3

* Japanese buyers say these offers are too high

* Spot premiums are down amid ample supply in Asia (Adds details)

TOKYO, Sept 4 (Reuters) - Global aluminium producers have offered Japanese buyers premiums of as low as $100 per tonne for primary metal shipments during the October to December period, three sources directly involved in pricing talks said on Monday.

That premium would be 15 percent to 16 percent lower than the prices for shipments over the July to September period, the sources said.

Another seller sought a premium of $110 a tonne, which would be 7 percent to 8 percent lower than the current quarter, the sources said.

Japan is Asia's biggest aluminium importer and the premiums for primary metal shipments it agrees to pay each quarter over the London Metal Exchange (LME) cash price CMAL0 set the benchmark for the region.

Spot premiums have weakened in Japan amid ample supply in Asia despite the recent surge in the prices for the light metal and solid local demand from the automobile sector. three-digit offers are way too high as they don't reflect the current spot market," said one of the sources, a Japanese trader who declined to be named because of the sensitivity of the matter, adding that some spot deals were done recently at around $86 per tonne.

For the July to September quarter, Japanese buyers agreed to pay premiums of between $118 to $119 per tonne PREM-ALUM-JP , down 7 percent to 8 percent from the prior quarter due to softer spot premiums. quarterly pricing negotiations began last week between Japanese buyers and producers, including South32 Ltd S32.AX , Alcoa Inc (NYSE:AA) AA.N , Rio Tinto Ltd RIO.AX RIO.L and Rusal 0486.HK . The talks are expected to last toward the end of this month.

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