The weekly Davis Index for US primary aluminum premiums delivered US Midwest decreased on Monday amid production shuts down due to COVID-19 concerns.
The Davis Index premium for P1020a reduced to 13.5¢/lb delivered US Midwest, under the three-month LME aluminum contract on Monday, down from 14.1¢/lb. The premium for 6063 billet lowered to 6.5¢/lb delivered, from 7¢/lb under the same LME aluminum contract.
Premiums will continue to be impacted as the overall demand for aluminum moves lower in the US Midwest and beyond due to the temporary automotive shutdowns. Increases in logistic cost have helped to prevent the premiums from reducing even more as market participants look for balance between the drop in demand with the extra cost for delivery.
The three-month LME aluminum contract closed on Monday at $1,568/mt down $86/mt from $1,654/mt on March 16.