Aluminum premiums could fall: market

Jul 05, 2013 | 08:38 AM | Michael Cowden

Tags  aluminum, Midwest premium, P1020, LME, warehouses, load out, policy change, aluminum michael cowden

CHICAGO — Midwest aluminum premiums continued to strengthen amid wide contangos on the London Metal Exchange even as market participants questioned whether changes to LME warehouse policies could push premiums down in the future—potentially dramatically.

AMM’s Midwest P1020 premiums inched up on the low end to a range of 12 to 12.25 cents per pound July 3 from 11.75 to 12.25 cents previously.

"Right now we are mostly transacting over 12 (cents). But then there is the LME announcement that everyone is evaluating," one producer source said. "It is new information, and the market is still trying to digest it. However, the knee-jerk reaction is that it will have a downward effect on premiums."....

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