Last week’s (ending 2 February) PRN report from prn trader reveals we saw “frantic activity” as we moved towards the close of the compliance year on Wednesday (31 January).
The week started with strong activity in the aluminium market, as the last remaining buyer secured their final evidence, albeit, as reported by some, at a premium cost, according to PRN analysis by prn trader.
Prn trader said that keen observers will be “eagerly awaiting” the release of the 2017 final quarters aluminium tonnage as the “tightness evidenced would appear to point to a weak quarter and reduced carry in”.
“Small obligated companies with last minute demand along with some that had miscalculated previous purchasing requirements led to the 2017 ending with a whimper,” the trader said.
“As is traditional at this time of the compliance year, when buyers roles transfer from the hustle and bustle of final purchasing to the heavy administration workload that comes with the dreaded data round, trading opportunities became more limited.”
“2017 PRN availability tightened towards the end with some large last-minute Glass buyers having to pay a premium to switch out previously contracted transitional tonnage.
“2017 Wood demand continued to be met with higher value transitional PRNs. Concerns about the growth of wood demand in 2018 has resulted in the transitional market witnessing an early rally of the price up to £9.50 as these buyers competed with late 2017 buying.
“Most remaining materials finished the year in surplus with some sellers having pre-December tonnage left unsold at the close.
“As is traditional at this time of the compliance year, when buyers roles transfer from the hustle and bustle of final purchasing to the heavy administration workload that comes with the dreaded data round, trading opportunities became more limited.
“Buyers remained active in Plastic as concerns continue to surround export routes in 2018. Wood, Aluminium and Glass have seen good activity with forward contracts negotiated. All other materials namely, Paper, Steel and EFW held their price spreads against a background of weak demand.”