PHYSICALS - Initial Q3 MJP aluminium deals done at $90/t - sources

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Ian Walkerian.walker@fastmarkets.comPhysicals Reporter+44 (0) 20 7337 2145

London 27/06/2016 - Initial deals for third-quarter aluminium ingot supply have been done at $90 per tonne for delivery to major Japanese ports (MJP) with one producer, sources close to the matter claimed.

This is down 21 percent from the lower end of the second quarter settlement at $115-117 and down 18 percent from offers initially tabled by producers at $110 per tonne at the end of May.

Still, other producers are holding out for higher premiums and negotiations still have some distance to run, the sources noted, with $90 likely to be a floor on any continuing discussions.

Stocks of aluminium ingots at Japan's major ports rebounded in May from April's 18-month low and rose for the first time since August, according to data compiled by Marubeni Corp. Total inventories at the ports of Yokohama, Nagoya and Osaka rose a net 12,400 tonnes to 337,200 tonnes at the end of May from 324,800 tonnes - the lowest since September 2014 - in April.

On the Japanese spot market, aluminium ingots have been trading at premiums of $80-90 per tonne and averaged around $100 throughout the second quarter.

Japan typically meets almost all of its 1.7 million tonnes of annual demand for aluminium ingots from imports; supply is predominantly negotiated on a quarterly basis.

(Editing by Mark Shaw)



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