Extension of consultation period for proposed launch of European secondary aluminium billet premium

Fastmarkets is extending the consultation period for its proposal to launch an assessment of the secondary aluminium billet premium, delivered duty paid Europe, for a further two weeks, following initial feedback on the proposed specifications.

The announcement of the proposed assessment gave an initial closure date of December 2. The consultation period will now end on December 21.

The proposed price specifications are:

Secondary aluminium billet premium, ddp Europe
Quality: Minimum 50% scrap
Quantity: Minimum 100 tonnes
Location: Delivered duty-paid Europe, premium on top of London Metal Exchange cash price
Timing: Within 3 months
Unit: USD per tonne
Payment: 30 days after loading (other payment terms normalized)
Publication: monthly, first Friday, 3-4pm UK time.
Note: Other scrap-to-primary ratios normalized.

Fastmarkets is now seeking final comments on the minimum percentage of scrap, proposed as 50%, or other minimum or maximum scrap and primary aluminium ratios.

Fastmarkets also invites market feedback on whether the methodology should specify just post-consumer scrap OR post consumer, any remelt and extrusion scrap.

Fastmarkets proposes to price the market on a monthly basis, publishing on the first Friday of the month - the same pricing schedule as Fastmarkets’ low-carbon aluminium differentials.

The extended consultation period for this proposed launch will start on December 7 and will end on Wednesday December 21. The launch will then take place, subject to market feedback, on January 6, 2023.

Fastmarkets launched its initial consultation for the new premium in response to the recent growth in the secondary market. It will allow Fastmarkets to bring additional transparency to the aluminium value-added product market, and will also complement the existing suite of Fastmarkets’ primary aluminium assessments, alongside the low-carbon differential for value-added-products.

Because of the growing interest in sustainability in the aluminium sector, market participants have told Fastmarkets that there is a growing need for transparency in the sector and its price relation to primary aluminium. Some have said that demand for green products could push the values of secondary billet premiums above those for primary billet premiums.

To provide feedback on this price, or if you would like to provide price information by becoming a data submitter to this price, please contact Carrie Bone by email at pricing@fastmarkets.com. Please add the subject heading ‘FAO: Carrie Bone re: secondary aluminium billet.’

To see all Fastmarkets’ pricing methodology and specification documents, go to https://www.fastmarkets.com/about-us/methodology.

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