Proposal to amend frequency of P1020A aluminium import premium in Brazil

Brazil has decided not to renew a previous duty-free import quota, which has significantly reduced liquidity and means that the premium is not moving on a regular basis during pricing sessions.

Domestic output became more prevalent after producers Alcoa and South32 decided to restart operations at their Alumar smelter, in northeast Brazil.

Fastmarkets expected that both these changes could slow down deal-making for aluminium imports, and that has been confirmed throughout the first quarter of 2023.

During January and February – according to the latest data published by Brazil’s industry and foreign trade ministry, MDIC – the country imported 25,867 tonnes of unalloyed aluminium.

This was down by 36.58% from 40,787 tonnes in the corresponding period a year before, and 58.63% lower than 62,528 tonnes in January-February 2021. It was also the lowest volume since 2013, before the quota was introduced, when the country imported only 3,371 tonnes in that same time window.

The proposed decrease in the frequency of assessment will affect the following premium:
MB-AL-0022 Aluminium P1020A premium, cif dup Brazilian main ports, $ per tonne

Fastmarkets currently assesses the Brazilian import premium once a fortnight, on a Tuesday, at 3-4pm London time. This premium assessment was launched in September 2014.

The consultation period for this proposed amendment starts on Wednesday March 22 and will end on Monday April 24.

The amendment will then take place, subject to market feedback, on Monday May 1, with the first assessment under the new frequency being published on Tuesday May 30 and every last Tuesday of the month thereafter.

To provide feedback on this assessment, or if you would like to provide price information by becoming a data submitter to this price, please email pricing@fastmarkets.com. Please add the subject heading “FAO: Renato Rostás, re: Brazilian aluminium premium assessment.”

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