Brazil is off to slow start in the aluminium market amidst a weakening economy

2014 has been a bad year for Brazil and things do not look much brighter in 2015 as the country still seems to be in a haze of lethargy as the end-user demands remain low and most producers holding enough stocks to sustain them through the first quarter resulting in a quiet marketplace.

The positive aspect of the stagnant market is that the premiums have maintained a stable rate with Metal Bulletin’s P1020A ingot premiums assessment standing at $600-650 per tonne as on Thursday January 15.

Buyers complain that the sloth-paced market has forced many of them to extend their year end holidays, some even up to a month.

Consumers are still long in aluminium after a disastrous 2014 and the condition is still not conducive for trading volumes in the country’s spot market.

The slow Brazil economy has had a great impact on the country’s consumer market in the construction and automobiles sector, both of which use aluminium, dragging the demand for spurred by high energy prices and possibility of rationing in the country.

The overall atmosphere in the country is quite negative. Although some are optimistic that the situation will pick up once contract negotiations are underway in February most are pessimistic about the improvement of the market.

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