India has experienced a drop in imported aluminium scrap prices week-on-week, influenced by stable LME prices. This week, prices for all grades have decreased by up to 1.6 per cent, creating market uncertainty and prompting a cautious stance among participants.
Three-month LME aluminium prices remained steady within the range of $2,225 to $2,250 per tonne, showing no significant movement week-on-week. LME-registered warehouse stocks are at 922,000 tonnes, with aluminium prices continuing to hover near three-month lows.
In Europe, the holiday season has contributed to a bid-offer disparity in the market. According to BigMint's assessment, Tense scrap from the UAE has decreased by $30 per tonne to settle at $1,700 per tonne. Similarly, Zorba 95/5 from the UK saw a reduction of $15 per tonne, bringing the price to $1,960 per tonne CFR West Coast, India.
India's imports of scrap, alloyed aluminium ingots
Imports of aluminium scrap, a crucial raw material for producing alloy ingots, declined significantly by 8 per cent in the first half of 2024 (H1CY'24), totalling approximately 809,100 tonnes compared to 875,000 tonnes in H1CY'23.
Conversely, India's imports of alloyed aluminium ingots saw a substantial increase of 60% in H1CY'24, reaching around 112,158 tonnes. This is a notable rise from the 70,780 tonnes imported during the same period in 2023.
Domestic scrap market
In the domestic market, prices for tense scrap have fallen by INR 1,000 per tonne in both Delhi and Chennai. According to BigMint's assessment, current domestic tense scrap prices are INR 174,000 per tonne ex-Delhi NCR and INR 175,000 per tonne ex-Chennai. This decline reflects the downward trend in LME aluminium prices and the sluggish market conditions.
Outlook
The market is anticipated to remain sluggish due to ongoing uncertainty in the LME and a series of holidays, including the Independence Day long weekend and Janmashtami, which features extended breaks in Gujarat. Nevertheless, attention will be focused on the August alloys price settlement, as it will likely influence the direction of scrap prices.
Received under the content exchange agreement with SteelMint
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