Reuters reported that premiums for physical aluminum in Europe slipped this week from record highs as traders cited weak demand and worries that it could weaken further as unrest in Libya and rising oil prices threatened economic growth.
Traders said that premiums for duty paid metal in Rotterdam this week were at USD 190 per tonne to USD 205 per tonne over London Metal Exchange cash prices. This was down from USD 200 per tonne to USD 210 per tonne last week which matched the December 2006 record at the highest level since Reuters records began in 1998.
A trader in Europe said that premiums will start to slip. Metal from the Middle East that usually would go to Asia was being shipped to Europe. They can't sell it in Asia.
Traders quoted the premium for duty unpaid aluminum in Rotterdam at USD 127 per tonne to USD 145 per tonne this week versus last week's USD 130 to USD 140 which matched highs hit in late 2010. Duty unpaid premiums hit USD 170 in June 2010 their highest since Reuters records began.
The trader said that demand is going to plummet unless this Middle East situation is sorted out soon. Prices of aluminium for three-month delivery on the LME traded at USD 2,558 per tonne at 1148 GMT versus a close of USD 2,542 per tonne.
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