An East European trader agreed market
Aluminum prices were between Eur1,580-1,600/mt delivered this week but that it was getting harder to find material at below Eur1,600/mt because of rising scrap prices.
Another large automotive producer was due to hold an auction to negotiate Q3 prices and volumes this week, but due to technical issues it was delayed until Monday, market sources said.
Offers for 226 ingot were expected to be in the region of Eur1,600-1,620/mt for delivery to Poland and around Eur1,620/mt delivered Czech Republic, with
liquid metal some Eur60-80/mt higher delivered Germany.
A third big diecaster is also scheduled to begin talks over Q3 volumes and prices early next week.
The volumes required by these two large Q3 buyers are very healthy and more than anticipated, market sources said.
Upcoming Q3 talks between producers and buyers are expected to be tough as sellers push to raise the price of ingot to cover higher
aluminum scrap prices, while consumers cite good availability of metal and a low price of
primary aluminum on the London Metal Exchange as an argument for unchanged prices.
Spot market prices of 226 ingot have struggled to move higher through the first five months of 2016 and have languished at Eur1,580-1,620/mt delivered over the past four weeks, while scrap prices have moved up by around Eur50/mt or even more depending on delivery point and grade.
"I think there's less downside potential right now as the LME [
primary aluminum contract] is at a low level and demand is looking extremely good again this year," said the German diecaster.