US aluminum premiums have slipped from their recent heady heights after flood-delayed shipments reached their destinations and consumer panic ended, traders said.
Floods of the Ohio River caused some barge deliveries to be delayed, forcing consumers to buy spot quantities to tide them over. Now they have too much metal. We have had consumers asking us to delay material, a merchant said.
Premiums for nearby delivery of Western grade metal have slipped to 5.25 to 5.50 cents per pound over LME cash, down from 6.00 cents and above last month when they reached a peak of about 7.00 cents.
Benchmark A380 alloy prices have also slipped a couple of cents to 75-76 cents per pound, partly following the tumble in base metals at the start of this week as funds bailed out, but also due to demand not living up to earlier expectations.
One closely-watched industry publication had indicated that US car production would rise eight percent in the second quarter over first quarter levels, but Midwest alloy smelters saw no evidence of this on their orders books so far. We are not seeing this forecast in the sales end, a Midwest alloy official said. Alloy is used to make auto parts. Aluminum scrap prices have also softened a touch, merchants said.
Zinc premiums have eased a touch to 5.25 to 5.75 cents per pound over LME cash, down from 5.50 to 6.00 late March. Spot business was quiet, traders said.
The tumble in tin prices on Monday prompted some consumer business, enabling premiums to show some life and even firm up a touch in some cases, traders and producer-agents said. Even though (LME) prices have gone down, there is not a lot of material around, one producer agent said.
Consumers were only tempted to price some of the metal they were committed to take under forward contracts, even though tin plunged to its lowest since May 1995 on LME on Monday, a dealer said. If copper gets a cold then tin will get pneumonia, he added.
Nickel premiums were steady at 9 to 12 cents per pound over LME cash with some consumer business on the back of LME price drop.
Lead premiums were languishing in a low range of 2.0 to 2.25 cents per pound over LME cash as the sluggish market waited for the new auto battery making season to begin after a disappointing winter season.
