Metal Bulletin has made the South Korean cif and fca P1020 aluminium premiums duty-free to better reflect current market conditions, effective April 10.
The amendments follow a one-month consultation period.
Metal Bulletin will now only include in both assessments aluminium which can be imported into South Korea duty-free under free-trade agreements (FTAs).
The assessments will be renamed Aluminium P1020 cif MKP (Main Korean Ports) duty-free and Aluminium P1020 fca South Korea duty-free.
The assessments - Aluminium P1020 cif South Korea and Aluminium P1020 fca South Korea - previously included both duty-free and non-duty free aluminium.
Duty-free aluminium in South Korea is aluminium that is imported into the country free of the country’s 1% import tax due to FTAs.
South Korea has FTAs with several aluminium-producing countries, including India, Australia, Canada, New Zealand, Malaysia and Indonesia.
The change is to reflect industry feedback that duty-free aluminium is strongly preferred over non-duty free aluminium in South Korea. This is evident from duty-free aluminium accounting for around 70-90% of the aluminium imported into South Korea, according to market participants.
In 2017, imports from Australia, India, Canada, Malaysia, Indonesia and New Zealand accounted for around 80% of all South Korean aluminium imports, which totaled 1.14 million in 2017 according to data from the Korea International Trade Association.
India was the largest exporter of aluminium to South Korea, supplying 385,816 tonnes, or 34%, of the total, followed by Australia, which shipped 318,656 tonnes, or 28% of the total.
The exclusion of non-duty free aluminium from the assessment will more accurately reflect the premiums of the most dominant form of aluminium imports into South Korea.
All historical data related to both assessments prior to their amendments will remain available in the pricing section of the Metal Bulletin website and in the FastMarkets historic data section.
If you require further information or would like to become a data submitter for these prices, please contact Vivian Teo by email at: firstname.lastname@example.org. Please put 'FAO: Vivian Teo, re: duty-free aluminium premium in South Korea' in the subject line.
To see all Metal Bulletin’s pricing methodology and specification documents go to https://www.metalbulletin.com/prices/pricing-methodology.html
Metal Bulletin has made changes to its pricing methodology for both its South Korean cif and fca P1020 aluminium premiums, following a market consultation.