Japan first quarter aluminium talks to drag on: buyers refuse higher premiums

Quarterly pricing negotiations between Japanese aluminium buyers and global miners are set to continue next month as buyers are refusing to pay higher premiums for January-March shipments, five sources said on Friday.
It is unusual for the two sides not to reach agreement before the beginning of the quarter, but the sources said there remains a gap between producers' offers and buyers' bids.
Japan is Asia's biggest importer of the metal, and the premiums for primary metal shipments that it agrees to pay each quarter over the London Metal Exchange (LME) cash price set the benchmark for the region. For October-December, Japanese buyers mostly agreed to pay a record premium of $420 per tonne, up 3-5 percent from the previous quarter.
This year, Major Japan Port (MJP) premiums have risen 64 percent. Earlier this month, three top producers asked Japanese buyers to pay record premiums of $435-$440 per tonne for January-March deliveries, up as much as 4.8 percent from the previous quarter, citing higher US spot premiums triggered by solid demand and smelter shutdowns that have squeezed metal supplies, the sources said. One producer has lowered its offer to $430 while another one had come down to $425 by Friday, five buyer sources said.