India's imported aluminium scrap prices rise marginally

The Indian market is witnessing an increase in prices for imported aluminum scrap, driven by several factors. These include the upward trend in aluminum LME levels, shortage of material both domestically and globally, and escalating freight rates.

The three month LME price was around $2,231/t, a rise of $40/t w-o-w.

According to assessments by BigMint, aluminum imported scrap prices have increased up to 2.3%. Tense scrap from the UAE rose by $40/t to reach $1,790/t, while zorba 95/5, UK origin, increased by $5/t to $2,030/t CFR Mundra.

UAE Extrusion 6063 scrap also saw a $10/t rise to $2,145/t CFR western coast India, while talk scrap from the UAE rose by $70/t at $4,410/t. Freight rates from the European region to the western coast of India have nearly doubled post the Red Sea crisis, currently standing at $3,300-3,500 per 20 ft container compared to the previous $1,600 per container, as per sources.

Presently, the market is running in a sluggish pace with minimal activities taking place. Significant price discrepancies exist between the imported and domestic markets, with a bid-offer disparity of approximately $40-$50/t.

A buyer conveyed to BigMint that bookings for imported scrap have been made, but uncertainties persist with the arrival times amid reported delays. The persistent shortage of tense scrap in both domestic and international markets has resulted in a price increase in the northern region. The source additionally indicated that shipments booked between January and February 2024 are anticipated to arrive in May.

Manufacturers in northern India are always planning ahead to make sure they have the right raw materials for smooth operations. They stress the importance of buying locally, especially when there's a shortage from overseas, to keep things running smoothly, a source shared.

Further, a few alloy ingot producers are bound to maintain the continuous supply chain of semi-finished products i:e; alloy ingots just because of the existing MOU but the alloy ingot producers keep pushing for a price hike as bidding scrap premiums are a bit harsh to maintain appropriate conversion spreads, shared by alloy ingot manufacturer.

Meanwhile, China's Silicon 553 prices fell by $20/t and was at $2,010/t, CFR Mundra.

Domestic market

In the domestic aluminum market, tense scrap prices increased by approximately 0.6%, reaching INR 174,000/t, ex-Delhi. Gujarat reported tense scrap prices at INR 175,000/t on a credit basis and INR 173,500/t for immediate payment.

Recent deals

Around 3 containers of Europe origin Zorba 95/3 was traded at $1900/t, CFR Mundra.

Around 25 t China silicon 553 traded at $2,000/t, CFR Chennai.

Around 20 t Africa tense 9% was traded at 1815/t, CFR Chennai.

Around 65 t UAE trump (8-10%) sold at $1,880/t, CIF WC India.

Around 95 t USA TT HRB 3% bought at $1,800/t, CIF WC India Recently.

Outlook.

In the near term, manufacturers may face challenges in obtaining raw materials and managing operations as a result of substantial shortage of scrap in the domestic market, leading to an anticipated price increase.