Aluminum premiums will fall on LME rules: exec

Nov 11, 2013 | 04:02 PM | Michael Cowden

Tags  Novelis, Philip Martens, LME, London Metal Exchange, warehouses, regional premiums, Midwest premium, JPMorgan aluminum

CHICAGO — Regional aluminum premiums should gradually decrease to levels last seen 18 to 24 months ago—or even four to five years ago—due to the new London Metal Exchange warehouse policies, Novelis Inc. chairman and chief executive officer Philip Martens said.

"Over time, I think you will see a moderation of regional premiums. ... But it won’t happen overnight," Novelis said Nov. 11 in an exclusive interview with AMM.

The Atlanta-based aluminum roller and recycler generally passes through regional premiums in North America and Europe and should be unaffected by moves either way in those markets, Martens said. The main impact likely will be felt in Asia, where Novelis is exposed to Japanese premiums, which have increased sharply, while its competitors in China do not face the same cost increases, he said. ....

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