Market participants who spoke to American Metal Market this month said market conditions do not necessitate rising physical premiums. The Midwest aluminium premium was unchanged at 9.4-9.5 cents per lb this week.

But the market seems to be preparing for the possibility of the Section 232 decision rocking the boat for prices.

The LME three-month contract started 2018 at $2,268 per tonne ($1.03 per lb) on Tuesday January 2, its highest level since early 2012. The price has since corrected by 3.3%, closing at $2,194 per tonne (99.5 cents per lb) on Monday January 8, but still remains elevated after prices began to spike in mid-December.

Midwest premium futures on the Chicago Mercantile Exchange (CME) are also jumping, reaching 11 cents per lb for February and climbing to 11.45 cents per lb in July.

The main factor driving these developments is the 232; the US Commerce Department's reports on both the steel and aluminium probes are due this month. Commerce has until January 16 to release its report on the steel case, and until January 22 to decide on the aluminium case.

Market participants have told AMM they were skeptical that the aluminium decision was coming ahead of the January 22 deadline, and most were unsure what kind of remedies such a decision would put in place. However, it appears that rumors heard in mid-December – which claimed that Commerce had finalized a draft of its findings in the investigation and was ready to publish – were inaccurate, perhaps to the relief of US aluminium extruders and fabricators.

Now renewed speculation in the market has suggested that Commerce may not publish the results of its investigations at all, or at least not by the deadline.

Upon receipt of the Commerce report, President Donald Trump has 90 days to determine the next course of action.

But the president has not indicated that the metals industry is at the forefront of his agenda. A search of Trump's twitter account showed no mention of either metal, or of Section 232 overall, in months.

The past month in aluminium has been quiet in the United States, with buyers opting to destock their existing inventory instead of purchasing new spot volumes and market participants generally taking end-of-year holiday vacations. Throughout 2017, aluminium scrap had been considered the material of choice for buyers due to its competitive price versus P1020.