Japan Alloyed Al Makers to Offer 3-5 yen/kg Hike

Japanese major secondary alloyed aluminium makers including Daiki Aluminium Industry, Nikkei MC Aluminium, Summit Showa Aluminum and Asahi Seiren try to increase the selling price at the after shipment negotiation for February. They realize certain hike under higher aluminium ingot and scrap price in first half of February and higher offer from Chinese alloy makers. The makers intend to offer 3-5 yen per kilogram of hike.

The makers hold negotiation with automotive parts makers in the week. The price decreased by 1-2 yen per kg for higher priced items and kept the price for other items in January. The makers try to realize the higher price for February when the scrap cost increased by 7-8 yen per kg for high grade scrap and 2-3 yen for lower grade scrap in first half of February.

Higher offshore ingot market and lower yen rate pushed domestic primary aluminium ingot price by around 10 yen per kg in a month. Chinese offer increased to CIF US$ 2,390-2,330 per tonne for AD12.1 to Japan. The price represents around 200 yen per kg including freight to the users, which is around 10 yen higher in a month.

A domestic alloy maker source said the makers could increase the alloy price by 5-10 yen per kg. However, the makers try to increase the price in a series of hikes for 2-3 months to secure margin when the users resist wide hike.

An alloy maker source said the production in March is slight higher than February level due to firm domestic demand especially for automobile. Smaller alloy makers are still struggling to secure order in severe competition with Chinese ingot.