Prices of aluminium ADC12 alloyed ingots declined m-o-m across south India, with BigMint's benchmark monthly assessment placing the OEM-approved grade at a ten-month low of INR 208,000/t in Chennai, levels last seen in February 2024. This marks a fall of INR 2,000/tonne (t) m-o-m, primarily due to continued sluggish demand in the automotive sector and a weakened export market.

However, prices remained stable in the northern region, with the OEM-approved grade at INR 209,000/t in Delhi.

Meanwhile, on a w-o-w basis, prices saw a slight decline, driven by ongoing weak demand in the auto sector. Alloy ingot producers have warned that further cuts could pressure margins by narrowing the price gap between Tense and ADC12.

Presently, most companies are quoting INR 210,000-211,000/tonne for OEM-grade ADC12, making this range the most preferred for current trades. This price point allows steady demand and aligns with market expectations, as buyers find this range favourable for transactions following tag adjustments by a major automaker.

Meanwhile, three-month London Metal Exchange (LME) aluminium prices declined slightly by $25-30/tonne w-o-w to around $2,583/tonne.

Non-OEMADC12 prices stable m-o-m

BigMint's monthly assessments for the non-OEM grade of ADC12 stood at INR 201,000/t in Delhi and INR 203,000/t in Chennai, largely stable m-o-m.

Raw material prices hold steady

Prices of the basic raw material for aluminium alloys, that is, scrap, remained largely stable m-o-m. BigMint's assessment for Tense scrap originating from the UAE was at $1,800/tonne CFR Nhava Sheva, up slightly by $30/tonne m-o-m. Meanwhile, Zorba 95/5 from the UK stood at $2,100/tonne CFR west coast, India, a marginal increase of $30/tonne m-o-m.

Aluminium scrap import volume dropped by over 4.5 per cent in October to 150,474 tonnes compared to 158,174 tonnes in September.

In the domestic market, Tense scrap prices inched up by 1 per cent m-o-m in both Delhi and Chennai. According to BigMint's assessment, prices stood at INR 174,000/tonne ex-Delhi and INR 175,000/tonne ex-Chennai.

The scrap to semi-finished spread was at INR 33,000-35,000/tonne.

China's silicon prices firm m-o-m

According to BigMint's assessment, prices of China's 553-grade silicon were steady m-o-m at $1,730/t CFR Mundra.

Freights from China to Mundra for 20-foot containers stood at $2,000-2,300.

The global market for ADC12 remained sluggish due to weak demand. However, sources indicated that China has been actively importing aluminium ADC12 ingots from Thailand, driven by competitive pricing and duty exemptions.

Export market remains subdued

The export market for ADC12 was weak but showed slight improvement, with some inquiries from Japanese buyers. ADC12 auto OEM-approved prices were at INR 208,000-210,000/tonne. Typically, OEM credit prices are INR 1,000-2,000/tonne lower than major automakers' levels, but recently, some alloy manufacturers in south India have sold at INR 210,000/tonne on credit, with northern India-based offers also exceeding automakers' settlement prices.

A manufacturer stated, "Export demand for ADC12 from India to Japan and China remains low. We have had to reduce our offers from $2,450/tonne to $2,330-2,340/tonne, but demand has yet to pick up."

Outlook

Aluminium ADC12 prices are expected to remain stable in the short term as the automotive sector has yet to regain momentum. However, year-end destocking could lead to some improvement. Additionally, overseas demand for ADC12 is likely to remain slow due to the upcoming winter holidays, with market momentum expected to pick up after the New Year holidays.

Note: This article is received under the content exchange agreement with BIGMINT and published as received without edits from AL Circle.

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