- Trade slows on currency depreciation, market uncertainty
- GST reforms expected to boost automotive ADC12 demand
India’s imported aluminium scrap prices remained range-bound w-o-w, following largely stable prices on the London Metal Exchange (LME). Scrap trade was sluggish through the week, pressured by currency fluctuations and elevated market uncertainty. Buying sentiment remained weak, though participants anticipate a modest recovery in demand as the festive season approaches.
Price assessments
BigMint assessed Tense scrap from the US at $1,960/tonne (t), largely stable w-o-w, while US Taint Tabor HRB (2-3%) also remained steady at $2,160/t. Extrusion 6063 saw a w-o-w decline of $25/t, while Tense scrap from the Middle East remained stable. Meanwhile, Zorba 95/5 from the UK recorded a gain of $15/t w-o-w.
LME prices inch up w-o-w despite inventory inflows
At the time of reporting, LME aluminium prices stood at $2,617/t, up slightly by around $5/t as compared to $2,613/t last week.
Meanwhile, aluminium inventories at registered warehouses posted a slight gain of 2,975 t to 482,575 t from 479,600 t in the previous week.
Market insights
Aluminium scrap buying stayed muted during the week, weighed down by cautious sentiment and a sharp rise in the USD-INR exchange rate, which further curbed trade activity.
Prices remained largely unchanged in both local and international markets, while demand for US- and Middle East-origin Tense scrap and Taint Tabor continued to weaken, keeping their prices under pressure. Limited buying interest persisted, with the UAE market struggling to hold above $2,600/t.
Domestic Tense scrap prices dropped by INR 1,000/t w-o-w to INR 195,000/t ex-Delhi and INR 198,000/t ex-Chennai, as weakness in the local market weighed on demand. With local and import prices showing a wide gap, imports remained unviable for buyers.
In northern India, heavy rainfall dampened trade amid a weak local market. Domestic Taint Tabor was assessed at INR 195,000-196,000/t, while Extrusion 6063 held steady in the INR 212,000-213,000/t ex-Delhi range.
In the semi-finished segment, ADC12 prices remained range-bound w-o-w across northern and southern regions, with steady demand and improved scrap availability lending support.
A market participant noted that the recent GST cut on vehicles is likely to boost automotive demand, driving higher consumption of aluminium alloy ADC12 in die-casting. Stronger sales, particularly in entry-level cars, are expected to support prices, while smoother GST implementation and improved affordability may further lift ADC12 demand and provide price stability.
BigMint’s monthly assessment for OEM-grade ADC12 was INR 230,000/t in Delhi and INR 232,000/t in Chennai.
Silicon price trends
According to BigMint’s assessment, silicon 553 prices from China declined by $10/t w-o-w to $1,350/t CFR Mundra.
Outlook
Aluminium scrap prices are expected to remain largely range-bound in the near term, supported by steady LME trends and moderate festive season demand. Domestic ADC12 consumption may see gradual growth, driven by improved automotive sales following the GST cut. However, currency fluctuations, weak local demand, and limited import viability could continue to constrain trade activity and keep price movements modest.
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