London (Platts)--21Dec2012/827 am EST/1327 GMT
Spot demand in the European physical aluminium market remains weak with little market activity reported as the seasonal holiday approaches. "There's nothing going on. Just a little end of year stuff," said one European trader. The trader said that business had pretty much been completed for the first quarter now and that most market participants had closed their books for the year. "Sales for the first quarter have dried up. We should some spot demand emerge in the second half of January. There's no change to premiums," the trader added. A producer said that premiums had weakened to the lower end of the current range at the beginning of the weak as the Dec/Jan backwardation continued to trouble some market participants. However, the producer said that the backwardation had now been flushed out now and premiums had maintained their range. "Now everything is back to normal. The backwardation seems to have completely gone," he said. The producer said that premiums were at $280/mt plus LME cash on a duty-paid basis and at $225/mt plus LME cash for duty-unpaid material. "There is upside potential for premiums in the first half of next year. People thought that they might start to tumble with the recent backwardation. The fact that they didn't is a good sign for further strength," the producer said. A European consumer said that he had more or less finished for the year. "We have not done any fresh quantities in the past week," the consumer said. The consumer said that he would not be bidding for the online Rusal tender announced last week. "We will not be putting in an offer. I know that they want a high number for that material," he said. On December 14, Rusal said it was considering selling 300 mt of super high purity 3N8 grade aluminium for January-February delivery via an online tender. Delivery of the material is either FOB St Petersburg, in-warehouse Rotterdam or CIF Asian ports or another location at the buyer's choice subject to Rusal's acceptance, the company said on its website. The deadline for bids is December 20 and the name of the winner will not be publicly announced, Rusal said. However, Rusal reserves the right to publicly announce the winner's price/premium. A second trader said that he had not done any business in the past week. He said that premiums were $280-290/mt plus LME cash on a duty-paid basis and at $225/mt plus LME cash for duty-unpaid material. Platts premium assessment for duty-paid Good Western was unchanged this week at $280-295/mt, in-warehouse Rotterdam plus LME cash. The premium assessment for duty-unpaid Good Western was also unchanged at $225-235/mt plus LME cash, in-warehouse Rotterdam, as was the premium for A7E at $225-235/mt plus LME cash, duty-unpaid in-warehouse Rotterdam. The premium for A7E FOB St Petersburg remained at $200-210/mt plus LME cash.--Greg Smart, greg_smart@platts.com --Edited by James Leech, james_leech@platts.com