- Need-based buying continues across imported scrap market
- Govt proposes abolishing 2.5% scrap import duty
India’s imported aluminium scrap prices showed mixed trends w-o-w amid stronger LME aluminium prices.
According to BigMint’s latest assessment for CFR Nhava Sheva deliveries, UK-origin zorba 95-5 scrap prices declined by $5/t w-o-w to $2,685/t, while UK-origin wheel scrap prices increased by $20/t to $3,150/t.
LME aluminium strengthens w-o-w
Three-month aluminium prices on the London Metal Exchange (LME) traded higher w-o-w, closing at $3,147/t on 13 July against $3,113/t on 6 July, up by $34/t, or 1.1% w-o-w.
Meanwhile, LME aluminium inventories declined by 9,325 t, or 3.2% w-o-w, to 286,225 t on 13 July from 295,550 t on 6 July.
LME aluminium prices strengthened during the week ended 10 July, supported by tight exchange inventories, ongoing supply concerns outside China, resilient manufacturing sentiment, and easing global trade tensions. However, profit-booking emerged towards the end of the week following fresh inflows into LME warehouses.
Market scenario
Market sentiment remained cautious amid continued volatility in LME aluminium prices, with sharp fluctuations creating uncertainty and prompting buyers to limit purchases to immediate requirements. Spot buying activity remained subdued, resulting in wide price variations across the imported scrap market, although a few transactions were concluded during the week, reflecting the cautious buying sentiment.
UK-origin wheel scrap was heard sold at $3,185/t CFR Nhava Sheva for a 23 t cargo. US-origin Taint Tabor (HRB 2-3%) scrap was traded at $2,680/t CFR Nhava Sheva for 100 t earlier in the week, while subsequent deals were reported at around $2,630/t CFR Nhava Sheva for two containers, highlighting the prevailing pricing volatility.
The Ministry of Mines has recommended abolishing the 2.5% basic customs duty (BCD) on aluminium scrap imports to reduce raw material costs for secondary aluminium producers and address the inverted duty structure. The proposal comes amid tightening global scrap supplies and export restrictions by several countries, with the move expected to improve industry competitiveness, support value addition, and ensure a more stable supply of imported scrap, which meets 80-85% of India’s secondary aluminium sector’s raw material requirements.
On the domestic front, aluminium scrap prices showed mixed trends during the week. Casting-grade scrap prices in northern India declined amid subdued buying activity, while other scrap categories recorded gains on improved demand. Meanwhile, casting-grade scrap prices in southern India remained largely stable w-o-w.
Chinese silicon prices
According to BigMint’s latest assessment, China-origin Silicon Metal 553 prices increased by $5/t w-o-w to $1,350/t CFR Mundra from $1,345/t, supported by firmer Chinese export offers and improved buying interest despite comfortable supply availability.
Outlook
The imported aluminium scrap market is expected to remain cautious in the near term, with continued volatility in LME aluminium prices and need-based buying likely to keep trading activity subdued. Market participants will closely monitor developments surrounding the proposed removal of the 2.5% basic customs duty (BCD) on aluminium scrap imports, as well as global scrap supply conditions and export restrictions, which could influence price direction and import flows in the coming weeks.
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