London 05/09/2016 - An aluminium producer has tabled an initial offer to buyers for fourth-quarter ingot supply at $80 per tonne on a cost, insurance and freight basis to major Japanese ports (CIF MJP), sources told FastMarkets.
This is down from the initial offer that Rio Tinto Alcan made last Tuesday at $82 and is 10 percent from the lowest offer in the third quarter at $90.
Spot premiums for aluminium ingots in Japan are currently at $65-75 per tonne - the lowest on FastMarkets' records - under the weight of low producer offers for large tonnages.
"This is just an initial offer. I think that it'll come down a bit more though - I expect it to conclude around $75," a source told FastMarkets.
Stocks of aluminium ingots at the three major Japanese ports (MJP) fell a further 3.4 percent in July to a 22-month low and are nearing the 300,000-tonne mark, according to data compiled by Marubeni Corp.
Total inventories at the ports of Yokohama, Nagoya and Osaka fell 10,900 tonnes to 305,900 tonnes at the end of July - the lowest level since September 2014 - from 316,800 tonnes in June. Stocks are also down 38 percent from July 2015 when they stood at 490,900 tonnes.
Japan is one of the world's largest consumers of aluminium, meeting its 1.7 million tonnes of annual consumption almost exclusively via imports.
(Additional reporting by Archie Hunter, editing by Mark shaw)