(Adds details and quotes in paragraphs 4-10) The premium for...

(Adds details and quotes in paragraphs 4-10)

The premium for aluminium shipments to Japanese buyers in January to March was set at $90 per metric ton, down 7% from the previous quarter, as demand remained sluggish, six sources directly involved in pricing talks said.

The figure is lower than $97 per ton for October to December and is the lowest since the first quarter of 2023. It also came below initial offers from global producers at $95 a ton.

Japan is Asia's biggest importer of aluminium and the premiums PREM-ALUM-JP for primary metal shipments it agrees to pay each quarter over the London Metal Exchange (LME) cash price CMAL0 set the benchmark for the region.

The quarterly pricing talks began in late November between Japanese buyers and global suppliers, including Rio Tinto (RIO) and South32 (S32) .

Two global producers and some buyers settled at $90 a ton at the end of December, and other buyers came to an agreement early this year, according to the sources.

In late December, one producer had lowered its offer to $92 while another raised its offer to $97 as spot premiums rose elsewhere in Asia, but both producers finally trimmed their offers to $90 at the end of the month, the sources said.

"We have made a compromise because we wanted to keep the principle of agreeing to the deal before the end of the quarter," a source at a producer said.

The sources declined to be identified because of the sensitivity of the discussions.

Both buyers and sellers shared a view that Japanese demand from non-automotive industries and construction is weak.

Aluminium stocks at three major Japanese ports AL-STK-JPPRT were at 330,000 tons in November, according to Marubeni 8002.T , higher than the 250,000-300,000 tons that are considered healthy.

The ample stockpiles came despite a 27% year-on-year drop in Japan's import of primary ingots over January-November.

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Table: Japan aluminium premiums	  

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