Persistent Weak Overseas Demand Weighs Broadly on Regional Premiums
The overseas spot primary aluminum market maintained a soft tone this week. The seasonal off‑season at home and abroad became prominent, with insufficient end‑user physical demand. Spot premiums across major regions kept under downward pressure, trading activity was generally thin, and buyers remained cautious on procurement.
Japan Market: Sluggish Demand Drags Spot Premiums Further Down amid Supply‑Source Structure Tug‑of‑War
Japan’s spot aluminum premiums fell again this week, mainly dragged by deteriorating downstream end‑user demand. Restocking was limited to immediate requirements with no large‑scale pre‑stocking activity. Japanese buyers have adopted stricter purchasing criteria and become more selective, prompting the market to phase out some Indian‑origin material and non‑standard GW cargoes.
Supplies of primary aluminum ingots from the Middle East and Australia are relatively ample, serving as major import sources for Japan. Nevertheless, Indian suppliers reject the view that their cargoes will be fully cleared out. They pointed out that the Middle East aluminum market faced severe stress last March, and Indian material played a key role in keeping regional supply‑demand balance operational. Therefore, Indian‑origin cargoes will not be completely displaced in the near term. In addition, market rumours circulated that Indian producers had been invited to submit QMJP bids. Cross‑checks with industry sources show no factual support, and the story is largely dismissed as unsubstantiated.
US Market: Sparse Transactions Fail to Offset Weak Fundamentals; Demand Saps Premiums
Only scattered spot deals were concluded in the US primary aluminum market this week, and overall trading remained subdued. Hit by the downstream seasonal off‑season, physical consumption stayed lacklustre and purchasing sentiment was muted. Spot prices extended losses with regional premiums under pressure, and there is no clear sign of stabilization.
Vietnam Market: Sustained Weakness with Very Few Trades
Vietnam’s domestic spot aluminum market stayed depressed. Large‑volume genuine transactions were almost absent this week. Amid poor demand, transaction price benchmarks kept drifting lower, and the market operated on a weak footing.
South Korea & Thailand: Q4 MJP Expectations Take Shape; Persistent Bid‑Offer Divergence
Guided by expectations for the Q4 MJP settlement, the market consensus puts the upcoming MJP range at USD 280‑290/MT. Accordingly, traders in South Korea and Thailand have adjusted their offers toward this band.
Even so, broad Asian end‑user demand has not improved, and buying appetite continues to fade with buyers’ target prices moving lower. A notable market divergence has emerged: some sellers lifted offer prices marginally, yet downstream acceptance remains very poor as buyers keep cutting their expected price levels. Bid‑offer gaps are hard to narrow, genuine deal flow stays sluggish, and regional premiums remain under pressure.
Summary
Asian overseas primary aluminum markets saw broad‑based softness this week, with bearish performances across Japan, the US, Vietnam, South Korea and Thailand. Cautious buying sentiment, expectations for a lower MJP settlement, together with supply‑source structure adjustments created multiple headwinds weighing on overseas spot aluminum premiums. Demand conditions are unlikely to improve materially in the short run. Spot premiums are expected to continue range‑bound weak volatility at low levels.
