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Investing.com -- Rio Tinto Group and Century Aluminum Co. increased premiums on aluminum billets in the US by approximately 12% following disruptions to Middle East imports caused by the Iran war, Bloomberg reported Wednesday.
The two major US suppliers reportedly raised the premium on aluminum billets by about 3 cents per pound, or $110 per ton, above pre-war levels. Rio Tinto is also pushing customers to accept multiyear contracts at the higher rate, the report said.
The premium increase reflects the impact of the Middle East conflict on commodity flows from the Persian Gulf. The region accounts for nearly a fifth of US aluminum imports, and disruptions are forcing American buyers to source aluminum from the domestic market, where supplies are already tight and prices are higher.
Aluminum prices have risen more than 10% since the Iran war began in late February. The US Midwest premium, which is added to global benchmarks for aluminum delivery to that region, reached a record $1.1325 per pound.
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