The imported aluminium scrap market witnessed better inquiries after a long Christmas and New Year’s holiday. As a result, market participants are currently observing moderate transactions.
The prices of imported aluminium scrap into India and the Far East increased after the holidays on an upbeat futures market.
Meanwhile, in the domestic market, participants noticed a slight shortfall of material which may support scrap prices for particular grades.
In addition, the conversion spread from scrap to semi-finished has been affected during the last few weeks amid holidays as semi-finished prices have not increased parallelly in comparison to scrap prices and sales volumes were limited resulting in minor price fluctuation.
The three-month aluminium futures and spot prices on the London Metal Exchange (LME) jumped by $127/t against 20 December, 2022. Stocks stood at 422,075 t in yesterday’s closing, down by 25,175 t from 20 December, 2022.
There is an acute shortage of raw materials in the market and the US and the European region’s internal transactions seem to be very healthy up to a specific time frame, shared a renowned UK-based exporter.
In the context of scrap supply chain, casting scrap saw an uptick trend owing to tight availability both in the domestic and overseas markets. So, import scrap bids to India may stretch further for the near-term, shared an Indian indentor.
“As the future exchange is getting highly fluctuating and placing bids in the current scenario may affect the actual conversion spread of the booked material once it lands. So, we will have to take a final call upon procuring substantial quantities,” shared an Indian buyer.
SteelMint’s assessment
- SteelMint’s price assessment states the data from normalisation to rationalisation submitted by different channels resulted in $4,550/t for USA-origin aluminium talk clean, CFR Nhava Sheva.
- Current indicative offers for aluminium scrap tense from the Middle East hovers at $1,780/t, increased by $40/t reported on 20 December, 2022.
- Meanwhile, offers of Zorba 95-5/94-4 from the UK hovered at $1,950/t with a sharp hike of $50/t reported before the holidays i.e. on 20 December 2022.
According to a source, Japan has resumed its buying enquiries of aluminium alloy ingots and expects fresh export orders might fetch healthy prices in comparison to previous transactions.
Outlook
Market participants are expecting an uptrend in prices in near-term. Both offers and bids would gradually pick up once the trade channels are back in form. Although, a slight variation is there upon divergence of opinions among various importers and exporters.
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