SteelMint

India: Imported aluminium scrap prices fall w-o-w amid LME correction, cautious buying

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by

Aditi Sen
in ,

Tight wheels availability limits downside despite weaker demand

  • Limited offers emerge as sellers remain price-sensitive

India’s imported aluminium scrap prices declined w-o-w, in line with the correction in LME aluminium prices.

According to BigMint’s latest assessment for CFR Nhava Sheva deliveries, US-origin tense 6-7% scrap prices fell by $50/t w-o-w to $2,520/t from $2,570/t. Meanwhile, UK-origin Zorba 95-5 scrap prices decreased by $40/t to $2,765/t from $2,805/t, amid weaker market sentiment.

LME aluminium prices decline despite further inventory drawdown

Three-month aluminium prices on the London Metal Exchange (LME) declined w-o-w, closing at $3,234/t on 18 August, compared with $3,374/t on 11 August, down by $140/t, or 4.2% w-o-w.

Meanwhile, LME aluminium inventories declined by 6,475 t, or 2.6% w-o-w, to 246,925 t on 18 August from 253,400 t on 11 August.

Market scenario

The global imported aluminium scrap market remained subdued this week, with trading activity largely quiet amid heightened LME volatility and a corrective trend in aluminium prices. Market participants remained cautious, with limited fresh offers emerging as sellers held back amid uncertainty over price direction.

Availability of aluminium scrap, particularly wheels, has tightened significantly across key markets, while higher replacement costs are providing support to offers. Meanwhile, exceptionally low LME warehouse inventories and reports of US buyers paying premiums of up to $400/t over LME for aluminium amid the 50% duty on virgin ingot imports are raising concerns over further tightening in scrap availability and potentially higher prices.

On the domestic front, aluminium scrap prices showed a mixed trend during the week. Tense and taint tabor scrap prices firmed, while extrusion scrap remained under pressure and utensil scrap was stable. The market remained cautious amid subdued buying activity from secondary alloy producers. Casting-grade scrap saw better support, while extrusion scrap continued to face pressure from weak demand. Overall, domestic scrap prices are expected to remain mixed in the near term, with cautious procurement limiting the upside.

Chinese silicon prices

According to BigMint’s latest assessment, China-origin Silicon Metal 553 prices declined by $5/t w-o-w to $1,380/t CFR Mundra on 18 August, from $1,385/t on 11 August, amid subdued downstream demand and weaker market sentiment.

Outlook

Imported aluminium scrap prices are expected to remain under pressure in the near term, with LME volatility and subdued buying interest likely to keep trading cautious. However, tight scrap availability, exceptionally low LME inventories and rising replacement costs could limit the downside. Wheel scrap availability is expected to remain constrained, while elevated US premiums could provide further support to global scrap prices.

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