South Korea bought non-western aluminium up to mid-2006 deliveries, paying $5-$10 a tonne more than the current quarter premiums, as the markets worry about tight supplies of Chinese metal, an industry source said. The Public Procurement Service said on Thursday it had bought a combined 20,000 tonnes of non-western primary aluminium ingots from Glencore and Korean trading house LG International Corp.
The government agency, which imports raw materials for Korean medium- and small-sized firms, declined to provide prices.
But a source close to the deals told Reuters the agency had bought 10,000 tonnes at $52 a tonne over the London cash price, CIF, from Glencore for Pusan arrival. From LG for Inchon arrival, it had bought the same amount at $61 a tonne CIF over London cash price, he said.
Non-Western origins include China and Russia.
South Korean aluminium importers, who depend heavily on Chinese supply, have been worried about shipments since power-hungry China's moves to rein in its aluminium industry by killing tax incentives for exports of the metal.
Suppliers were reluctant to offer the metal, which is mainly used in construction, cars and electrical goods, at low prices for Thursday's tenders as the shipments ranged up to May of next year, the source added.
In the absence of Chinese supplies, overall premiums of aluminium ingots could not help rising eventually, Korean traders said. Also, the Chinese yuan revaluation last week might raise costs for Korean importers, some said.
Earlier on Thursday, the state-run agency bought 10,000 tonnes of good western aluminium ingots from Gerald at $73 a tonne CIF over London cash prices, up about $1-$2 from the current quarter premiums.
But it had passed on tenders to buy 600 tonnes of natural rubber.
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