Japan Aluminum Stockpiles Drop as Sales to China Rise

May 15 (Bloomberg) -- Aluminum stockpiles in Japan, Asia’s largest net importer, declined for a second month in April to the lowest level since November as traders increased shipments of surplus metal to China. Inventories in Yokohama, Nagoya and Osaka ports dropped 13 percent to 295,600 metric tons at the end of last month from 338,600 tons on March 31, Marubeni Corp. said today. It was the largest drop since November 2007, when stockpiles fell 16 percent. The volume decreased, after reaching a 10-year high of 374,600 tons in February, as exports gained, according to Marubeni, Japan’s largest aluminum importer. China’s imports of aluminum and products almost tripled to 439,902 tons in April, the Beijing-based customs office said May 12. The amount was a record, according to CRU International Ltd. analyst Wan Ling. Imports surged this year as the State Reserve Bureau bought 590,000 tons from domestic aluminum smelters to bolster stockpiles and support local prices. Japan’s aluminum demand contracted after manufacturers cut output as the economy heads toward its worst postwar recession. Stockpiles also declined as Japanese trading companies and aluminum rolling mills pared purchase volumes under supply contracts this year on anticipation of worsening demand. Japan’s shipments of aluminum rolled products are forecast to fall 11 percent from a year earlier to 1.80 million tons in the year to March 2010, the lowest in 23 years, the Japan Aluminium Association said March 27. That’s a third straight year of decrease as carmakers and electric machinery producers reduce output and raw material purchases amid a global recession.