Japanese Primary Aluminium Quay Inventory Increases for 3 Months

Primary aluminium ingot inventory at Japanese quays increased by 8,300 tonnes to 193,300 tonnes at the end of December from a month earlier. Domestic aluminium re-rollers and metal traders have gradually increased ingot procurement in response to slow recovery of domestic demand for aluminium rolled products. A concerned source forecasts these players would decrease the new procurement slightly to minimize inventories before the end of Japanese major fiscal year in March.

The quay inventory continued to increase for 3 months in a row. The inventory increased by 6.3% to 86,700 tonnes in Yokohama, by 6.4% to 92,600 tonnes in Nagoya and by 16.7% to 14,000 tonnes in Osaka at the end of December from a month ago.

The total quay inventory stayed below 200,000 tonnes, the level along which domestic ingot supply is indicated to be tightening. However, current domestic demand for primary aluminium has shrunk by 20-30% than ever. A trader source said the supply and demand are balanced presently.

Affiliated sources suppose Japanese ingot users may decrease the procurement volume for January-March. One background is that most ingot consumers close their financial years at the end of March. Another background is that spot premium in Asian region stays as high as US$ 130-140 per tonne.