Aluminum buyers in Japan, Asia’s top importer, have settled on a premium that’s as much as 23 percent lower for the July quarter, as rising output swells a global glut of the lightweight alloy.

The premium for the three months starting July 1 will drop to $90 a metric ton from $115-$117 a ton in the current quarter, according to two Japanese buyers, who asked not to be named because the talks are confidential. The Japanese premium is the benchmark for Asia and indicates the amount paid to global producers on top of London Metal Exchange prices. The premium was last at $90 a ton in the October quarter last year.

The two buyers said they have settled with a single seller. Price negotiations continue between Japanese companies and other global suppliers.

The lower fee reflects excess supplies of aluminum, used to make everything from cars to window frames. Prices are expected to extend losses as production in China, the world’s top supplier, accelerates in the second half, Goldman Sachs Group Inc. said earlier this month.

The metal currently trades just above $1,600 a metric ton and Goldman forecasts it dropping to $1,450 a ton in three months. It hit a six-year low of $1,432.50 a ton in November.

Stockpiles in Japan at the end of May rose 3.8 percent from a month earlier to 337,200 tons, the first increase in nine months, according to trading company Marubeni Corp.

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