(Corrects paragraph 9 to show target is 6.5 mln T, not 650,000
T, and that current demand is 4 mln T)
* Ford plans to launch aluminium-intensive truck, others
* Could push aluminium price to $2,500 per T -Japan industry
* Premiums paid by Japanese buyers are too high -industry
TOKYO, July 11 Prices for aluminium could climb
around a third to as high as $2,500 per tonne if more U.S.
automakers start producing vehicles made from the metal, said
the new head of Japan's aluminium industry body.
Ford Motor plans to launch a new aluminium-intensive
truck this year, with speculation that other carmakers could
start using more of the metal, which is lighter than steel and
helps make vehicles more fuel-efficient.
"If automakers follow Ford's step to use more aluminium,
supply of the metal will become short and prices could rise as
high as around $2,500 per tonne," Takashi Ishiyama, chairman of
the Japan Aluminium Association, said on Thursday.
He said that association members such as producers of rolled
aluminium would be able to pass on a gradual increase in prices
to their customers, and that they would welcome the chance to
use current inventory to make products they could sell at higher
London Metal Exchange aluminium prices, which hit a
13-month high earlier this week, stood around $1,900 per tonne
Ishiyama said that Ford would need supply from the
equivalent of a whole smelting plant to churn out its new F-150
trucks, providing a big new source of demand.
He added that some Japanese aluminium product makers such as
top manufacturer UACJ Corp were aiming to win a bigger
slice of the growing U.S. market by adding production facilities
But Ishiyama, also the president of Nippon Light Metal
Holdings Co Ltd, said Japanese automakers had been
trying to improve car efficiency through technological advances
rather than shifting to aluminium vehicles.
"However, we have a long-term goal to aim to boost aluminium
demand in Japan to 6.5 million tonnes a year by 2035 from 4
million tonnes now by widening the metal uses to new areas
including automobiles," Ishiyama said.
Ishiyama said that the premiums buyers must pay over LME
cash prices to secure physical metal are far too high, as actual
freight, insurance and other costs to get metal delivered would
be around 10 percent of current premiums.
Aluminium buyers in Japan have mostly agreed to pay record
premiums of $400-$408 per tonne over LME prices for
July-September shipments, up 8-12 percent from the previous
The country is Asia's biggest importer of the metal, and the
fee sets the benchmark for the region.
The premiums, which have nearly doubled from two years ago
and risen five-fold from five years ago, come as smelter
shutdowns and logjams in releasing metal from LME storage have
squeezed global supply.
He said that while association members could pass on gradual
rises in LME prices to their customers, it was more difficult to
do the same with soaring premiums.
"In some deals, we can pass on the cost of the metal and
premiums, but we have more cases which we can't do that."
(Reporting by Yuka Obayashi; Editing by Joseph Radford)