India: Aluminium alloy ingot prices remain range-bound w-o-w

The Indian domestic aluminium alloy ingot market saw stable prices amid factors like range-bound scrap, correction in futures contracts by $50-70/tonne (t), and price cuts by primary producers by up to INR 3,750/t ex-works. According to SteelMint's assessment, prices of ADC12 aluminium alloy ingots were steady at INR 188,000-190,000/t exw-Faridabad, excluding GST.

Presently, the aluminium alloy ingot ADC12 market in India is marked by moderate demand, leading to price levels that have remained limited within a certain range, in keeping with production level adjustments.

An ongoing issue within the industry remains the limited supply of aluminium scrap tense, a critical raw material for ADC12 production. This shortage has prompted certain buyers to offer premium on prices in the northern region.

Specific trade sources informed that the export contracts for ADC12 are in the range of $2,180-2,190/t CIF Japan.

On the other hand, smaller and medium-sized aluminium alloy manufacturers continue to face challenges as downstream industry like die casting adjusted production level by around 20-30% on limited orders.

Currently China's silicon prices stand at $1,820-1,830/t CIF west coast India.

Based on information compiled by Steelmint, automobile production in July 2023 reached 2,087,087 units, indicating an increase of 62,384 units compared to June 2023.

Material scarcity and limited trades are challenging the western region, while the northern zone is experiencing limited material supply, as said a trade source.

As per the latest information, some off-grade aluminium alloy ingots were traded for China and the tentative price of Middle East-origin tense scrap was observed at $1,550-1,560/t, range-bound w-o-w.

Market highlights

Primary alloy ingot producers lower prices: India's primary aluminium producers Balco and Hindalco decreased alloy ingot (ADC12) prices by up to INR 3,750/t ($45/t). Post-revision, Balco's prices stand at INR 206,250/t ($2,478/t) while Hindalco's prices are at INR 207,500/t ($2,493/t). All prices are exw, excluding GST.

Domestic raw material prices down w-o-w: The local aluminium scrap market witnessed a slight downward trend in prices d-o-d. Currently, tense scrap prices stand largely stable at INR 155,000/t while taint tabor scrap prices are at INR 157,000-158,000/t, both exy-Delhi and excluding GST.

Outlook
Trade sources said, the imminent price announcements by Maruti are expected to play a key role in bolstering the market outlook for the forthcoming month. Thus, sources feel, there may not be significant contraction in prices in the near term.