Investigation into automotive model certification expected to dampen aluminium demand in Japan

Market sentiment remain mixed on whether the investigation will impact aluminium prices and production

Demand for aluminium in Japan’s automotive sector may drop after leading car manufacturer Toyota suspended the production, sale and shipment of three models pending an investigation into certification from the country’s Ministry of Land, Transport & Tourism, sources said.

Mazda has reportedly also halted the shipment of two models currently in production.

The suspensions, which were implemented on June 3 so authorities could conduct on-site audits, were expected to end at the end of June, but have now been extended until the end of July, sources told Fastmarkets.

The automotive sector is the biggest user of aluminium in Japan, accounting for 1,653,800 tonnes, or 43.8%, of the country’s total demand for the light metal, which was 3,771,300 tonnes in 2023, according to the Japan Aluminium Association.

The latest results statement from Toyota shows that the company produced 999,088 units in the country from January to April 2024, down by 83,773 vehicles, or 7.7% from 1,082,861 units in the same period of 2023.

Mixed views on how this will impact the aluminium market

“While there’s no real impact at the moment from the automotive investigation issue, there’s an expectation [there will be] an impact in the future,” a trader source said. “We heard that some manufacturers will cut some production next month.”

But a second trader source said the likely impact of the investigations was still unclear.

“We have yet to hear of any requests for deliveries to be delayed,” the second trader said.

Most market participants said they did not expect any impact to be significant for aluminium prices.

“We expect a slowdown in demand from the auto sector, but [there] will not be a huge decrease in demand,” a third trader source told Fastmarkets.

Despite the potential for a slowdown in demand for aluminium, supply tightness remains in the region, with prices being supported by premiums offered for the third quarter being above the previous settlement in quarterly negotiations.

Fastmarkets’ twice-weekly assessment of the aluminium P1020A (MJP) spot premium, cif Japan was $145-160 per tonne on Tuesday June 18, up from $140-155 per tonne on June 11.

Get a forward-looking view of the base metals market to inform your business strategy with Fastmarkets’ base metals price forecasts. Learn more.

What to read next
The publication of the affected price was delayed for 29 minutes. The following assessment was published late: MB-ZN-0110 Zinc spot concentrate TC, cif China, $/per tonne This price is a part of the Fastmarkets Base Metals Physical Prices package. For more information or to provide feedback on the delayed publication of this price or if you […]
The publication of Fastmarkets’ price assessments of the base metals arbitrage for copper, aluminium, zinc and nickel for Friday August 1 were delayed due to reporter error. Fastmarkets’ pricing database has been updated.
The Mexican aluminium market is experiencing low spot activity and pricing pressure amid ongoing tariff uncertainty and heavy reliance on US trade. Market participants are watching closely for potential trade deals that could reshape the current landscape.
The publication of Fastmarkets’ MB-ALU-0003 alumina index adjustment to fob Australia index, Brazil for Thursday July 31 was delayed because of a reporter error. Fastmarkets’ pricing database has been updated.
US export controls on recycled copper would have unintended consequences that could weaken the country’s domestic recycling and manufacturing ecosystems, the president of the Recycled Materials Association (ReMA) said.
American Chambers of Commerce (Amcham) across Latin America are calling for urgent negotiations to prevent the escalation of trade tensions between their countries and the US, following the announcement of sweeping 50% tariffs by President Donald Trump.