Spot prices of aluminium ADC12 alloy ingots (automobile equivalent) in Delhi NCR and Chennai remained range-bound w-o-w, according to BigMint’s latest assessment. In the Delhi NCR region, ADC12 spot prices were assessed at INR 213,000/t ex-Delhi, aligning with domestic tense scrap prices, which settled at INR 181,000/t ex-Delhi.
Likewise, ADC12 prices in Chennai were reported at INR 215,500/t on immediate payment basis, excluding GST. At the same time, casting scrap prices were at INR 182,000/t ex-Chennai.
LME aluminium prices
Meanwhile, three-month LME aluminium prices are largely stable at $2,490-2,500/t compared with the previous week’s $2,525/t.
Imported scrap prices
According to BigMint’s assessment, prices of tense scrap originating from the Middle East, particularly the UAE, rose by $50/t to $1,830/t and zorba 95/5 from the UK was at $2,060/t CFR west coast, India.
Meanwhile, a few grades like US tense 6-7% recorded a rise of $30/t w-o-w in prices, moving up to $1,850/t CFR west coast.
Market comments on ADC12
Demand for ADC12 from Japan has significantly decreased due to its weaker currency, currently at 161.4 against the US dollar. Buyers are showing minimal interest in procuring materials.
Last export inquiries from Mundra to Japan were at $2,320/t CFR Mundra, but offers remain at around $2,420/t.
In the Indian domestic market, demand for ADC12 is stronger. Therefore, participants are focusing on the domestic market and not prioritising exports during this period of uncertain global trade conditions.
ADC12 imports from Malaysia to Chennai are decreasing due to rising freight rates, because of which, import inquiries have declined, leading to firmer domestic ADC12 prices. Additionally, inquiries from India for the UAE material have increased. The UAE benefits from the current freight scenario compared to Southeast Asian countries.
Meanwhile, some alloy manufacturers in the market claim to have sufficient scrap inventories to meet demand for the next one to two months. These inventories mainly consist of scrap from delayed consignments purchased at higher price levels. Manufacturers are hesitant to reduce their offers for ADC12 alloy, as selling alloy ingots at lower rates would negatively impact their profit margins.
Material availability for certain grades is expected to tighten due to the holidays in Europe. Buyers are actively seeking imported scrap before the European market goes into full holiday mode. There is also anticipation that prices may rise further once the holidays begin.
Current freight rates
China to EU: $6,500-7,000 per 20 feet (ft) container
Shanghai to NYC: $5,600-6,000 per 20 ft container
Malaysia to Chennai: $3,000 per 20 ft container
China’s silicon market
Prices of China’s silicon 553 have seen a marginal uptick reaching $2,000/t CFR Mundra amid rising freight rates. However, buying interest stayed low because major aluminium alloy manufacturers have sufficient silicon supplies, leading to reduced market activity.
Additionally, the sea freight from China to Mundra was heard at $3,800-$4,000 per 20-ft container.
Domestic scrap market scenario
In the domestic market, tense scrap prices have been range-bound in both Delhi and Chennai. BigMint’s assessment shows domestic tense scrap prices (ex-Delhi NCR) were at INR 181,000/t and INR 182,000/t ex-Chennai.
In the Gujarat region, tense scrap was traded at INR 180/kg.
Recent offers, deals
UK aluminium wheels were traded at $2,380 CFR Chennai.
Tense 2% Mexico-origin was traded at $2,000/t CFR Mundra.
Aluminium zorba UK 95-5 was traded at $2,070 CFR Nhava Sheva.
Outlook
The demand for alloy ingots in India remains stable this week. Sellers anticipate settlement prices to align with those of the previous month. However, a correction in scrap prices may lead to a downward adjustment in ingot prices.
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