Platts assessed South Korean spot aluminum premiums at $108-$116/mt plus London Metal Exchange cash, CIF Busan, on Wednesday, widening from $110-$112/mt a week ago.
Spot import trades in South Korea was thin as focus was on second quarter contracts, which had settled at $116/mt plus LME cash CIF Busan this week, following Japanese Q2 settlements at $115-$117/mt plus LME cash, CIF Japan, last week.
South Korean buyers do not always follow the Japanese premium trends as the two markets usually have different supply and demand dynamics, but major traders in the country said the trend between both markets was similar for Q2. "The Q2 [South Korean] premiums at $116/mt were up from $110/mt for Q1, and this reflects a slight tightening of supplies in some areas of South Korea," said a South Korean trader, who had done Q2 contract deals at $116/mt CIF Busan with overseas producers.
South Korean traders added that $116/mt CIF Busan would be the basis for setting resale prices to end-users as well as booking spot import cargoes.
A second trader reported selling to customers several thousand tons at $116/mt plus LME cash, CIF Incheon basis, for April to June.
The trader will resell Australian duty-free cargo, booked on a term basis, to the customer, he said.
Some sources said they see the deal normalized at $106-$108/mt CIF Busan as the buyers would have to bear the upcharge costs in Incheon of $8-$10/mt. Supplies were tight this week in Incheon, sources said.
There were two large consumers in the area seeking up to 15,000 mt, one source added.
Meanwhile, overseas sellers said they have not received inquiries from South Korea this week.
"I plan to offer at $113-$115/mt CIF Busan but no sales after sales at $110-115/mt CIF Busan in the last two weeks," said one overseas trader.
Domestic trades at $110-$115/mt FCA for several hundred tons, for April as well as for April to June, were also reported. The $110-$115/mt FCA equates to $100-$110/mt CIF, said one party in the deal.
"The deals at $100/mt are there for smaller trades," said the trader who had reported deals at $116/mt plus LME cash, CIF Incheon.
