Japan re-exports aluminium to China - traders

Japan, Asia's top net importer of primary aluminium, is re-exporting the metal to China, trimming stocks that stand at a 10-year high, traders said on Monday.

China, the world's top producer and consumer of aluminium, is aggressively importing spot primary aluminium ingots as arbitrage has opened after the State Reserves Bureau and power grids sucked nearly one million tonnes of aluminium from the domestic market since December, supporting Chinese prices. [ID:nHKG108709]

Traders estimated China's imports of primary aluminium would surge to around 200,000 tonnes in March, more than 1.5 times the country's imports in 2008.

Fabricators in Taiwan were also increasing buying due to low stocks of the metal.

"March's import could reach 200,000 tonnes," a manager at a fabricating plant in Guangdong province said.

He said aluminium supply was tight in China. Demand for aluminium products such as profiles had been better than expected this month, although it was weaker than a year before.

"We are taking aluminium (to China)," a trader in Japan said, adding the firm had started re-exporting aluminium this month.

"It's not just Japan, everybody's shipping cargoes to China because that's where all the activity is," the trader said.

Weak demand from Japanese car makers to soft drinks manufacturers has driven up stocks of imported aluminium.

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