![]() beer-makers, who use a lot of aluminium, are vehemently against the idea. The agency is currently consulting on the specifications of its premium assessments. delivery has never been negative before, the prospect has prompted some to suggest Platts should introduce a floor price on the unpaid premium. The storage squeeze behind WTI oil’s swoon into negative territory doesn’t apply to a commodity that can be stacked on any surface hard enough to carry its weight. The pricing agency helpfully launched a duty-unpaid aluminium indicator, based on the simple mathematics of deducting the 10% duty and the estimated cost of freight to a Midwest user.Īs such, duty-unpaid metal in Canada is currently calculated at just 2 cents per lb, or $44 per tonne.Įvidently, were the duty-paid premium to fall further, there is the potential for the duty-unpaid premium to turn negative.Īluminium is not oil. Just there was no duty prior to 2018, and now there is. ![]() The resulting premium has always been duty-paid. The CME contract is based on S&P Global Platts’ (Platts) assessment of the price of metal delivered to a user in the U.S. But that doesn’t allow for the tariff effect. Plot the premium on a chart and it appears to have fallen to its lowest since 2017. The CME Midwest Aluminium spot contract has fallen to $179 per tonne (8.105 cents per lb) from over $300 in mid-March and a peak of almost $500 in 2018 after the tariffs were first introduced. The spectre of a negative premium is just the latest manifestation of the disruptive power of those tariffs. aluminium market remains defined by the 10% import tariff introduced by the Trump Administration in May 2018. In reality, unlike the April meltdown in the WTI oil contract, no-one in the United States is going to be trading a negative price for their metal.
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