03 SEPTEMBER 2012Platts
Japan's Jul ADC aluminum shipments dip 2% from Jun amid switch to AC output
Edited by : AL CIRCLE
2 min read
Japan's domestic shipments of auto diecasting aluminum alloy slipped 2.2% month on month to 38,784 mt in July, despite a 3.3% gain in total alloy shipments to 70,322 mt, the Japan Aluminium Alloy Refiners Association said Thursday.
On a year-on-year basis, July ADC shipments were up 2.7%, while total alloy shipments were up 5.2% -- largely due to a lower base last year due to plant shutdowns following the March 11 earthquake.
Shoji Matsunaga, an official with the association, told Platts that July ADC shipments fell compared to June as secondary aluminum alloy smelters focused on producing alloy for molding applications, known as AC. July shipments of AC came in at 19,044 mt, up from 16,597 mt a month ago.
"There was a shift to AC production from ADC as AC alloys are not exposed to competition from China imports. Japanese end-users have strict specification requirements for AC compared to ADC," said Matsunaga.
According to Japanese customs data, the country imported 31,734 mt of aluminum alloy from China in July, up from 30,325 mt in June. Most of these alloy imports are ADC, according to trade sources.
Matsunaga, however, noted that the domestic AC market would likely not see significant growth as automotive makers have started to substitute AC with ADC to cut costs. According to market sources, ADC is more than 10% cheaper than AC.
"There are many diecasters with large press machines that can cope with ADC rather than AC. AC is used for wheels these days, while most other components that used to be made of AC are made out of ADC," Matsunaga said.
"Aluminum smelters want to focus on AC but they cannot afford to stop making ADC as the market for ADC is still bigger," he added.
The 553-grade 98.5% silicon metal is mostly used for ADC production, while the better 441-grade 99.5% silicon metal is used to make AC.
On a year-on-year basis, July ADC shipments were up 2.7%, while total alloy shipments were up 5.2% -- largely due to a lower base last year due to plant shutdowns following the March 11 earthquake.
Shoji Matsunaga, an official with the association, told Platts that July ADC shipments fell compared to June as secondary aluminum alloy smelters focused on producing alloy for molding applications, known as AC. July shipments of AC came in at 19,044 mt, up from 16,597 mt a month ago.
"There was a shift to AC production from ADC as AC alloys are not exposed to competition from China imports. Japanese end-users have strict specification requirements for AC compared to ADC," said Matsunaga.
According to Japanese customs data, the country imported 31,734 mt of aluminum alloy from China in July, up from 30,325 mt in June. Most of these alloy imports are ADC, according to trade sources.
Matsunaga, however, noted that the domestic AC market would likely not see significant growth as automotive makers have started to substitute AC with ADC to cut costs. According to market sources, ADC is more than 10% cheaper than AC.
"There are many diecasters with large press machines that can cope with ADC rather than AC. AC is used for wheels these days, while most other components that used to be made of AC are made out of ADC," Matsunaga said.
"Aluminum smelters want to focus on AC but they cannot afford to stop making ADC as the market for ADC is still bigger," he added.
The 553-grade 98.5% silicon metal is mostly used for ADC production, while the better 441-grade 99.5% silicon metal is used to make AC.
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