Offers for Chinese domestic spot aluminum alloy ADC12 generally inched up amid a rebound in primary aluminum ingot prices and a pickup in domestic demand, industry sources said Tuesday.Platts lifted its weekly China domestic ADC12 price assessment to Yuan 14,750-15,250/mt ($2,411-2,492/mt) ex-works Tuesday, from Yuan 14,600-15,100/mt the previous week."I heard domestic ADC12 offers have gone up slightly due to higher raw material costs," said an east China-based producer, who was keeping offers steady around Yuan 15,000/mt.An east China-based diecaster added: "We bought a small lot from a trader at Yuan 15,400/mt this week. It's more expensive than the Yuan 15,000/mt I paid last month. I heard it's due to rising raw material costs."Another east China-based producer, who indicated offers at Yuan 15,500-15,600/mt, up from around Yuan 15,400/mt last week, said raw material prices such as scrap aluminum were mainly affected by the higher primary aluminum ingot prices."Domestic ADC12 prices have gone up this week due to higher primary ingot prices. We are also seeing a pickup in the domestic demand as factories are busy fulfilling their year-end orders," the second eastern Chinese producer said.He added that this pickup was a bit later than usual as their customers were only placing their orders now in view of uncertainty over the global economy.A Southwest China-based producer said: "Generally, during October to December, plants will be busy. However, the demand seemed a bit muted this year compared with previous years. Maybe it has to do with the slowing Chinese economy."The eastern Chinese diecaster agreed, added: "Business is slow compared with previous years. We have orders on hand now but we are not sure if they can keep us busy till the end of the year."Chinese domestic spot aluminum ingot was priced at Yuan 13,880-13,920/mt Tuesday, up from Yuan 13,610-13,650/mt last Tuesday but down from Yuan 13,970-14,010/mt on October 8. China was closed October 1-7 for National Day.On Tuesday, November aluminum futures stood at Yuan 13,980/mt on the Shanghai Futures Exchange compared with Yuan 13,700/mt last Tuesday and Yuan 13,935/mt on October 8.On Monday, the official LME cash price for aluminum was $2,055.50-2,056/mt, up from $1,963-1,963.50/mt last Tuesday.In Japan, spot ADC12 buyers stepped back to the sidelines as the yen weakened steeply to Yen 113-114 to a dollar Tuesday, from the Yen 108 level a week ago after returning from a public holiday on Monday.Platts maintained its ADC12 export price assessment steady at $2,160-2,190/mt FOB China Tuesday unchanged from the previous week amid thin trade due to weak buying interest on a weaker yen.One deal was reported done late last week for 200-300 mt at $2,190/mt CIF Japan, loading from Guangzhou in January, but no deal was reported closing this week.Offers were at $2,190-2,220/mt CIF/CFR Japan, January-February loading, unchanged from last week, trade and diecaster sources said.The price difference between CIF and CFR is negligible.Japanese diecaster and trade sources would monitor the exchange rate moves until they see signs of stability, they said."As the yen weakened fast, there is also a possibility of the yen strengthening," said one Japanese trader."We need to pass on the raw material cost rise to automakers. But the changes in the exchange rates are not reflected straight away in the auto components prices -- there is a time lag of three to six months," said a Japanese diecaster source."Trade has been thin this past three weeks due to the exchange rate, people have been buying conservatively in small lots of 200-300 mt, and it will be like that for the near term," said a second Japanese trader.Chinese sources said they had not received any inquiries from Japanese buyers this week due to the weaker yen."Japanese buyers' import inquiries have been very bad this week. They are taking a break, waiting for the yen to strengthen," said a South China-based producer, heard offering steady at $2,190-2,220/mt CFR.An east China-based producer, who was keeping his offers steady at $2,200/mt CFR, said: "There are absolutely no inquiries from Japan this week as most of the traders are adopting a 'wait-and-see' approach.""Japan still need to import ADC12 from China as it has demand for it. However, most Japanese buyers will delay buying for the time being," said another east China-based producer, who heard market indications around $2,200/mt CFR.A source at one Japanese diecasting plant, which buys over 5,000 mt/month of ADC12 alloys via daily tenders, said there had been no change in purchasing."It is very difficult to forecast what is ahead, so we will continue to buy constantly from the spot market," said the source.
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