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Price notice: US aluminium DUP premium update

Aug 13, 2018 | 12:22 PM | New York |


In reaction to market commentary to the proposal of a US duty-unpaid aluminium premium (DUP) assessment, American Metal Market will not launch the assessment as feedback suggests the need for a different approach.

The market has indicated interest in a DUP assessment, but also concern as to how such a premium would be determined given the infrequency of DUP transactions. This lack of liquidity makes such an assessment untenable in American Metal Market’s judgment, with the concept failing to meet the company's standards of quality at this time. 

American Metal Market is now considering launching a cost insurance and freight (cif) aluminium premium for aluminium imports into the port of Baltimore, which - like a DUP price - would not include the 10% tariff levied on such imports by the Trump administration in March. Any cif transactions concluded in different East and Gulf Coast locations would be normalized to Baltimore. 

As a result of the DUP not being introduced as an assessment, American Metal Market also will not publish an aluminium P1020 free-market (also known as all-in) duty-unpaid Midwest price using the assessment (London Metal Exchange cash aluminium PM bid price plus premium). A possible free-market calculation incorporating a premium without the 10% tariff is still being considered for launch by American Metal Market.

American Metal Market will issue a pricing notice with further details of its cif premium assessment proposal on Thursday August 16, as well as its amended free-market price proposal, upon which a new consultation period will be introduced.

To provide feedback on these changes, or if you would like to provide price information by becoming a data submitter, please contact aluminium reporter Kirk Maltais at pricing@metalbulletin.com. Please add the subject heading FAO: Kirk Maltais, re: DUP Midwest aluminium premium.

To see all of American Metal Market’s pricing methodology and specification documents, click here

American Metal Market has no financial interest in the level or direction of the assessment.


 

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