Aluminium scrap prices in India have increased by 5-7%. According to BigMint’s assessment, taint tabor (USA, HRB-3%) rose by $30/tonne (t) to $2,040/t. Tense scrap from the US remained stable at $1,960/t. The primary driver was the w-o-w increase in LME aluminium prices. At the time of reporting, three-month LME prices rose by $130/t to $2,680/t from the previous week’s $2,551/t.
Additionally, talk scrap from the US and UAE saw prices rise by over 7% due to a $800/t increase in LME copper prices. Notably, LME copper prices reached a two-year high this week, exceeding $11,000/t. The surge was driven by strong long-term demand and tight supply, raising shortage concerns.
Global scrap market
An alloy manufacturer and scrap buyer stated, “All prices have increased due to rising LME aluminium prices. There was no major buying activity in the market as buyers are reluctant at these levels, resulting in a significant disparity between bid and offers. Additionally, freight rates have risen substantially, and container availability has become a worldwide challenge.”
A buyer noted, “European freight rates to the west coast of India have increased to $4,200-$4,500/40 ft container, up from $3,700 earlier. This rise has led to a reduction in profits, with previous per container profits of $30-$40 now contracting to $20.”
A trader said, “Scrap demand in China appears weak at present, with issues at some ports and customs, particularly at Port Damaiyu. No cargoes are expected to arrive in this area for a month, causing materials to be diverted to India at higher rates. There is also a reported shortage of aluminium sections, TT, and trump globally, driving up current prices. Recently, 80 t of US TT HRB 2-3% was bought at $2,040/t, CFR Mundra.”
Moreover, a major automobile company recently increased aluminium alloy ADC12 prices to INR 3,950/t to INR 221,750/t for June 2024, supporting positive sentiments in domestic scrap prices.
Domestic scrap market
In the domestic market, tense scrap prices have risen by INR 3,000/t. BigMint’s assessment shows domestic tense scrap prices (ex-Delhi NCR) at INR 187,000/t. Prices rebounded last week after a sharp decline.
A source stated, “Tense prices have gone up in Delhi, which may push ADC12 prices up in the near term, along with the upward price announcement by a major automobile company.”
China’s silicon market
According to BigMint, prices of China’s silicon 553 have increased by $80/t, reaching $1,980/t CFR Mundra, mainly due to surged freight rates.
Recent deals
- Aluminium TT HRB 2% from Australia traded at CIF Chennai for $2,050/t.
- Aluminium extrusion 1% from Australia traded at CIF Chennai for $2,375/t.
- UK-origin wheels were traded at CIF Nhava Sheva for $2,500/t.
- Middle East trump 9-10% traded at CIF Malaysia for $2,090/t.
- US-origin extrusion 95/5 bought at $2,200/t, CFR Mundra.
- UK-origin zorba 95/5 bought at $2,170/t, CFR Mundra.
- Hong Kong-origin wheels were bought at $2,470/t, CFR Chennai.
Outlook
The market anticipates prices to remain on the upside following a consistent increase, potentially influenced by fluctuations in LME aluminium prices and a price hike announcement by India’s largest automobile company.