South Korean restocking provides brief support, but Asian primary aluminium spot premiums remain weak

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The overseas primary aluminium spot market remained subdued this week. Although limited restocking briefly improved trading activity in South Korea at the beginning of the week, the recovery was not sustained, and transactions weakened again from midweek.

Elsewhere in Asia, the traditional downstream off-season continued to restrict purchasing activity. Thailand recorded few inquiries and particularly weak trading, while Japan’s spot MJP moved lower as sellers faced increasing difficulty securing transactions. In the United States, the Midwest DDP premium showed little change from the previous week.

1. Review of spot premiums by region

According to SMM data, overseas primary aluminium spot premiums remained under pressure this week as weak seasonal consumption continued to limit downstream procurement. Market performance varied by region, but buyers generally remained cautious and focused on immediate production requirements.

Southeast Asia

Trading activity in Thailand remained very weak during the week. Few inquiries were reported as downstream consumers continued to operate cautiously during the traditional off-season.

Most buyers maintained a hand-to-mouth purchasing strategy and showed little interest in building additional inventories. With demand remaining subdued and transactions scarce, spot premiums continued to face downward pressure.

South Korea

Some downstream consumers in South Korea entered the market for restocking at the beginning of the week. The purchases temporarily improved transaction activity and eased the previously weak market sentiment.

However, the improvement was short-lived. Trading weakened again from the middle of the week after the initial restocking demand faded. Buyers remained cautious about securing additional cargoes, and overall transaction volumes stayed limited.

Japan

CIF Japan MJP primary aluminium spot

Japan’s spot MJP premiums continued to move lower this week amid weakened downstream demand. Cargoes became increasingly difficult to sell, while buyers maintained strong bargaining positions and showed limited willingness to make large-volume purchases.

Despite the continued decline, market expectations remained divided. Some participants still believed spot premiums could return toward the Q3 MJP benchmark if purchasing activity improves or spot availability tightens. For the time being, however, weak physical demand remained the dominant factor, and there was limited support for a sustained recovery in spot premiums.

United States

US Midwest DDP Primary Aluminium Premium

The US Midwest DDP premium showed little change this week. Transaction activity remained limited, but the market did not record a significant fresh decline compared with the previous week.

Buyers and sellers largely maintained cautious positions, leaving the premium relatively stable while the market waited for clearer changes in downstream demand or supply availability.

Market outlook

Overseas primary aluminium spot premiums are expected to remain under pressure in the near term as the traditional downstream consumption off-season continues.

Temporary restocking may briefly improve trading activity in individual markets, as seen in South Korea early this week. However, without a broader recovery in downstream demand, such improvements are unlikely to provide sustained support.

In Japan, spot MJP may remain weak as long as sellers continue to face difficulty securing transactions. Although some market participants expect prices to return toward the Q3 MJP benchmark, this would likely require stronger restocking demand or a tightening of available spot supply.