06 AUGUST 2013Bloomberg
Rusal says aluminum premiums to stay high as LME tackles backlog
Edited by : AL CIRCLE
1 min read
United Co. Rusal, the world’s biggest aluminum producer, said elevated premiums are supported by demand and financing deals as the London Metal Exchange tries to ease backlogs in its warehouses that drew complaints from users including MillerCoors LLC.
The LME, which oversees more than 700 warehouses worldwide, proposed rules last month to cut waiting times for withdrawals at some sites.
“The broader industry context is greatly supportive of the premiums paid in the market today,” Steve Hodgson, Rusal’s director for sales and marketing, said in an e-mailed comment to Bloomberg. “Today’s conditions are very different to those that prevailed in late 2010 at the time when the load out queues were forming and first reached 100 days.”
The aluminum market, excluding China, will have a deficit of 200,000 metric tons, compared with a 660,000-ton surplus in 2010, Hodgson said. Financing deals are also more profitable than in 2010, Hodgson said.
Premiums in Europe and North America have been falling in recent weeks because of seasonally slower demand and because some stock holders started to reduce positions on expectations of changes in the LME rules, Hodgson said.
The LME, which oversees more than 700 warehouses worldwide, proposed rules last month to cut waiting times for withdrawals at some sites.
“The broader industry context is greatly supportive of the premiums paid in the market today,” Steve Hodgson, Rusal’s director for sales and marketing, said in an e-mailed comment to Bloomberg. “Today’s conditions are very different to those that prevailed in late 2010 at the time when the load out queues were forming and first reached 100 days.”
The aluminum market, excluding China, will have a deficit of 200,000 metric tons, compared with a 660,000-ton surplus in 2010, Hodgson said. Financing deals are also more profitable than in 2010, Hodgson said.
Premiums in Europe and North America have been falling in recent weeks because of seasonally slower demand and because some stock holders started to reduce positions on expectations of changes in the LME rules, Hodgson said.
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