India: ADC12 aluminum alloy ingot prices decline on weakening raw material prices

Spot prices of aluminium ADC12 alloy ingots (non-OEM) in Delhi NCR and Chennai fell w-o-w, as per BigMint's latest assessment. In the Delhi-NCR region, ADC12 spot prices were assessed at INR 209,000/t ex-Delhi, aligning with domestic tense scrap prices which settled at INR 175,000/t ex-Delhi.

Likewise, ADC12 prices in Chennai were reported at INR 211,000/t on immediate payment basis, excluding GST. At the same time, casting scrap prices were at INR 176,000/t ex-Chennai.

The current spread between tense and ADC12 spot levels is at INR 33,000-34,000/t, widening by 3,000-4,000/t from previous levels of 29,000-30,000/t.

A credible seller source said: "We are currently in a restocking phase. This strategy aims to position us to release the inventory at a higher price and achieve an optimal profit margin once the monsoon season comes to an end."

A buyer source stated: "We have stocked material beforehand and it is not required at least for a month. So, currently need-based purchasing is going on for small quantities".

A source said, "Prices will begin to trend upward next month as trading activities, currently slow due to the rains in most regions of India, return to normal. In the meantime, traders are planning to stockpile materials at lower prices".

LME aluminium prices

Three-month LME aluminium prices fell $70/t to $2,224/t yesterday compared with the previous week's $2,300/t, Notably aluminium prices have reached an almost four-month low.

According to BigMint's assessment, Tense scrap from the Middle East, particularly the UAE, decreased by $60/t settling at $1,730/t. Zorba 95/5 from the UK also decreased by $25/t to $1,975/t CFR West Coast, India.

China's silicon market

Prices of China's silicon 553 dropped $50/t reaching $1,790/t CFR Mundra amid easing freight rates. However, buying interest has stayed low because major aluminium alloy manufacturers have sufficient silicon supplies.

Additionally, the freight rate from China to Mundra was heard at $2,540-$2,560 per 20-foot container.

Domestic scrap market

In the domestic market, tense scrap prices have decreased w-o-w by INR 2,000/t in both Delhi and Chennai. According to BigMint's assessment, domestic tense scrap prices are now at INR 175,000/t ex-Delhi NCR and INR 175,500/t ex-Chennai. This decline aligns with the falling LME aluminium prices and sluggish market trends.

Offers

ADC12 imported

• ADC12, Malaysia, CFR Chennai offers at $2460-80/t and to Mundra $2500/t.
  
  
• ADC12, UAE, CFR Mundra - 2350/t and bids at 2320-30/t.
  
  
• ADC12, UAE, Japan - 2350-2380/t (offers) and buyers are not interested for the material. Bid levels are at 2250-2280/t.
  
  

Special alloys

• LM24 - 216-220/kg, ex Chennai
  
  
• A356 - 230-235/kg, ex Chennai
  
  
• LM24, UAE, CFR Mundra - 2480-2500/t
  
  
• A356, UAE, CFR Mundra - 2560-2580/t.
  
  

Deal

• 30-40 t Tense sold at INR 175.5-176/kg, ex Chennai
  
  
• 30 t ADC12 sold at INR 211/kg, ex Chennai
  
  
• China silicon 553 bought at $1730/t, CFR Chennai- 1 container
  
  
• China silicon 441 bought at $1870/t, CFR Chennai -2 containers
  
  
• 50 t ADC12 heard traded at INR 222/kg (credit basis), ex Haryana
  
  
• Australia tense 2% traded at $1860/t CFR chennai - 2 containers
  
  

Outlook

In the near term, aluminum scrap and ADC12 prices are expected to remain rangebound due to uncertainties in LME aluminum pricing and the seasonal impact. Buying activity is also expected to remain slow.