Aluminium premiums in the United States and Europe fell in the week to Tuesday October 13, with a narrowing cash/three-month contango on the London Metal Exchange and a backwardation on the December/three-month spread incentivizing market participants to sell off metal.
Narrow LME spreads bring Rotterdam premium down 10% week on week.US Midwest premium also drops on narrowing contango.Main Japanese ports (MJP), Korea premium steady but bearish sentiment emerging.
Rotterdam dup premium falls 10% on spreads collapse
The duty-unpaid premium in Rotterdam fell to its lowest since September 8 this week due to the significantly narrower contango on the LME spreads.
Fastmarkets assessed the
aluminium P1020A premium, in-whs dup Rotterdam at $100-110 per tonne on Tuesday, down from $115-120 per tonne the previous week.
The daily premium is down 10% week on week and has declined in three separate pricing sessions over the past week.
"The spread situation is dire; it collapsed overnight and the cash-and-carry trade has been completely blown out of the water," one trader said.
The benchmark LME cash/three-month spread was most recently in contango of just $12.75 per tonne, compared with $27 per tonne last...