Aluminium stocks held at three major Japanese ports at the end of May rose to a seven-month high, reflecting inflows from delayed deliveries and also a rise in imports, an official at trading house Marubeni Corp said on Monday.
Aluminium stocks at the ports came to 225,400 tonnes at the end of May, up 6,300 tonnes or 2.9 percent from a month earlier, said Marubeni, which collects data from the key ports of Yokohama, Nagoya and Osaka.
The stocks rose for the second month in a row, after rising in April for the first time in four months. The May level was the highest since stocks stood at 225,800 tonnes in October, the official said.
A rise in aluminium stocks in Nagoya, central Japan, was due to a slight increase in imports from Australia, as well as deliveries delayed from April to May, the official said. "Output of aluminium products normally rises towards July and imports tend to rise, which was partly behind the buildup in stocks. But higher imports don't necessarily reflect stronger demand," the Marubeni official said. While production of automobiles has begun to pick up, output of beverage cans, which had been front-loaded, is peaking, he said. "We don't know how these two factors will balance out in the coming months. Given the uncertain domestic demand outlook, it's likely that aluminium stocks will stay at current levels or may even rise in the coming months," he said.
Japan, which has to buy nearly all the metal it needs overseas, annually imports about 2 million tonnes of primary aluminium, widely used in products ranging from computers, planes and electronics to the food sector.
Toyota Motor Corp has said it expects to resume full production globally in November and its Japanese output is expected this month to recover to 90 percent of levels seen before the March 11 earthquake. Japanese shipments of aluminium products fell 7.6 percent in April from a year earlier to 163,805 tonnes, industry data showed on May 25, reflecting weak demand as production was hit by the earthquake and tsunami. Reflecting the cautious demand outlook, premiums for primary aluminium shipments to Japan in the third quarter were agreed last week at a lower level than initially thought.
The premium in the July-September quarter has been set at $120 per tonne for at least one deal, up from $113 for the current April-June quarter, an industry source directly involved in premium talks said.
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