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Market Movers

Market Movers, Apr 3-7: Crude OSPs out soon, markets to get clearer view of Cyclone Debbie impact

With Alvin Yee

April 03, 2017 10:00:37 EST (2:54)

How will Saudi Aramco and Abu Dhabi National Oil Company price Asia-bound crude oil this quarter? Where will aluminum spot prices head after Japan settled Q2 aluminum premiums at $128/mt CIF basis last week? And what's the impact of Cyclone Debbie on commodity prices - particularly on metallurgical coal and sugar? Associate editor Alvin Yee looks at this and other factors that could drive commodity markets this week.

Join our conversations on Twitter - use #PlattsMarketMovers and connect with us.

Also read: Situation room: Cyclone Debbie hits world’s metallurgical coal capital

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Video Transcript

Welcome to Platts Market Movers, your three-minute look at what the week ahead holds for the Asian commodity markets.

Coming up, Japan's aluminum premiums settle for the second quarter and a cyclone in Australia impacts coal, agriculture and shipping markets.

Saudi Aramco, Abu Dhabi National Oil Company seen to issue crude oil official selling prices

But first, to oil - major producers Saudi Aramco and Abu Dhabi National Oil Company are expected to issue their official selling prices for crude oil this week.

Regional traders said they were unlikely to raise the price of crudes sold to Northeast Asia due to lower refinery run rates in the second quarter and despite Middle Eastern sour crude supply seen tightening.

China will announce its oil products exports quota for the second quarter in early April setting the ceiling volume for the first half of the year.

Market sources say it will likely to keep exports at or below H1 twenty sixteen levels amid a growing focus on reducing pollution and excess capacity.

Japan's Q2 aluminum premiums settled at $128/mt CIF

To metals - Japan's second quarter aluminum premiums were settled at $128 per metric ton on a CIF Japan basis on Friday. This is up 35 percent from the first quarter.

At present, Japan's spot aluminum premium is around $3 lower than the Q2 level. It remains to be seen if spot premiums can rise any further as the remaining Q2 contracts are locked in.

In coal, Cyclone Debbie disrupted rail, port and mine operations in Queensland last week, impacting coal markets in particular. The Australian state is the world's largest producing region for coking coal. The true impact on markets will become clearer this week as floodwaters clear, and the extent of the damage can be assessed.

The spot price of Premium Low Vol Australian coal was $158/mt FOB Friday, up 4.3% week on week.

In agriculture, sugarcane growers in Australia will also be assessing the impact of Cyclone Debbie, especially around the hard hit areas of Mackay and Proserpine. Twenty five percent of Australia's sugar cane crop could be affected.

The dry bulk market across Asia is also closely tracking the impact of the cyclone. Market players expect some congestion until the backlog caused by the closure of several ports along Australia's eastern seaboard is cleared.

So our big question this week is, what impact do you think the cyclone and widespread flooding will have?

Send us your views on Twitter with the hashtag PlattsMarketMovers. Thanks for kicking off your Monday with us and have a great week ahead.

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