NEW YORK The majority of
Midwest P1020 aluminum contracts for 2013 have now been signed,
according to traders and producers.
"Business is pretty good," one
producer told AMM. "Were pretty much done with
2013 and we sold a bit of material for November and December
P1020 spot business was steady
this past week, which has kept AMMs spot
premiums in a range of 11 to 11.5 cents per pound.
"Weve been seeing a steady
amount of business. Were at 11.5 (cents per pound)," one
However, spot business is
expected to teeter off soon as consumers run down stocks ahead
of year-end, according to producers.
"Theres (always) the usual
slowdown at the end of the year. Consumers want to have low
inventories," the producer said.
Most agreed that the slowdown
wont depress premiums, which have been at record highs
most of the year as traders store the metal in London Metal
Exchange-listed warehouses and keep supply off the market.
Global aluminum stocks on the
LME opened at 5.096 million tonnes Nov. 9, up from 5.084
million tonnes Tuesday.
Although some levels of
uncertainty abated once President Obama won re-election
Tuesday, sources said the outlook remains unclear with the
fiscal cliff looming.
"I think there will continue to
be uncertainty with this particular administration. (Obama)
will bring nothing but gridlock," one consumer said.
"Its now back to this
fiscal cliff," a second trader said, adding that he
doesnt think its as serious as some indicate. "Some
economists think a depression is coming. I dont think
its that dire. Its just essentially forcing us to
get our fiscal house in order. Im OK with that."
The aluminum industry stands to
benefit from a number of Obamas initiatives. Corporate
Average Fuel Economy (Cafe) regulations, for example, which
require vehicles to have an average of 54.5 miles per gallon by
2025, have pushed automakers to boost aluminum usage in
vehicles. Producers like Alcoa Inc. and Kaiser Aluminum Co.,
have invested heavily in their automotive capabilities as a
Still, many remain concerned
about Obamas effect on the overall economy.
"(Cafe standards) may have some
traction, but more importantly will be the general health of
the economy," the consumer said. "And I would say the general
health of the economy is more in question with Obama."
"Some people were saying,
Oh my god, Obama is bad for business! but
well see. Its not like if Romney was elected,
business would have got better immediately. Well just
have to wait and see," the first trader said.
"I will have to pay more (taxes
under Obama). But Im not going to stop buying my
Starbucks because were at the fiscal cliff," the second