Fears about a looming aluminium duty from the United States' Section 232 investigations have dashed hopes of the market taking advantage of a widening import aluminium arbitrage between Asia and the US.
The differential between canceling aluminium from London Metal Exchange warehouses in Asia and shipping the material into the US Midwest has reached an all-time high, but the market is skeptical it can take profit from it. The estimated arbitrage from Singapore, Busan, Johor and Port Klang to shipping to the US Midwest was at their widest since Metal Bulletin started tracking the indicator last June. For material originating from warehouses in Singapore, the estimated arbitrage was at $150 per tonne in February for shipments of 10,000 tonnes (via break bulk shipments), a dramatic increase from $84.84 per tonne the month before. In Busan, the estimated arbitrage rose to...