Low-carbon aluminum premium achieved at record Eur50/mt in Europe: producer

A producer sold low-carbon aluminum with a low-carbon premium of Eur50/mt ($59.45/mt) -- much higher than the typical range of $10-$15/mt -- amid rapid growth of the low-carbon aluminum market in Europe in 2021.

Premiums for low-carbon aluminum have been regularly reported in the value-added products market at a range of $10-$15/mt.

The Eur50/mt premium was written into a long-term contract for a "sensible volume" of foundry alloy, a producer told S&P Global Platts April 13.

The customer was willing to pay the premium because, "they value the carbon footprint and the transparency. It is a large part of their value proposition to their own customers," he added.

Meanwhile, a trader of low-carbon aluminum billet told Platts that if his customers did not want the certification guaranteeing the carbon emission profile, he would reduce his selling price by $10/mt, but as of now no one had refused the certificates.

Although premiums are being heard in the aluminum market for value-added products, in the P1020 market, the differential between Platts low-carbon aluminum assessment -- the LCAP, and the standard aluminum assessment remained at zero.