The recent downturn in the Indian aluminium scrap market can be attributed to a notable price decrease, primarily driven by a fall in futures contracts on the London Metal Exchange (LME). This decline results from limited transactions despite an increase in the number of improved offers. Many sellers who have returned from holidays are inactive, contributing to the overall market downturn.
Moreover, the rising sea freight charges have adversely affected the market following the incident in the Red Sea. This additional factor has further compounded the challenges the aluminium scrap market faces.
Pricing dynamics of aluminium wheel scrap
According to a reliable source, the pricing dynamics of aluminium wheel scrap destined for India from the Western region exhibit variations among sellers. Some sellers present offers with a substantial discount ranging from $70-80 per tonne, while others provide more modest discounts of $30-40 per tonne from the three-month LME futures until the second half of January 9.
Contrastingly, sellers based in the Middle East, particularly from the UAE, are experiencing more favourable outcomes due to price parity with the Western region. They have recently finalised deals at respectable prices ranging between $2,190 and $2,200 per tonne, CIF WC India.
"Previously booked tense scrap from the Middle East at approximately $1,540/t a month ago, CIF West Coast shipment deliveries could help maintain a better spread between scrap and semi-finished products," revealed sources.
SteelMint's evaluation of Zobra
SteelMint's evaluation of Zorba 95-5, originating from the UK, indicates a slight decline at $1,940 per tonne, reflecting a decrease of $15 per tonne. Additionally, Middle East Tense scrap prices are registered at $1,655 per tonne, marking a week-on-week reduction of $15 per tonne, as per SteelMint's assessment.
Moreover, a second recycler has shared insights that forthcoming elections and budget developments are anticipated to influence the market, potentially providing significant support to prices in the near term. Positive sentiments are expected to be bolstered by spot trades in this scenario.
Simultaneously, scrap discussions from the United States indicate trading in the range of 53-53.5 per cent of three-month LME futures, with actual transactions occurring at 52.5-52.7 per cent of three-month LME. Presently, three-month futures for aluminium are hovering at $2,245 per ton. Copper LME prices are reported at $8,387 per tonne at this time.
Additionally, aluminium inventories in LME warehouses are recorded at 569,100 tonnes, while copper stocks stand at approximately 161,725 tonnes. The Silicon metals market in China has experienced volatility ahead of the Lunar New Year holidays. Silicon 553 of China is currently priced at around $2,150 per tonne, CIF Mundra.
Received under the content exchange agreement with SteelMint
Responses
