Platts
Russian aluminum alloy prices defy LME fall
Edited by : AL CIRCLE
2 min read
Russian AK5M2 aluminum alloy offers were holding at $2,000-2,040/mt CFR Japan Friday, flat day on day, despite falling US scrap prices and lower London Metal Exchange aluminum prices, Japanese buyers said.
AK5M2 alloy, or melted scrap aluminum, is used as feedstock for ADC12 secondary aluminum alloy production in Japan and southeast Asia.
One Japanese aluminum smelter source said offers for AK5M2 with 1% zinc and 0.85% magnesium were at $2,000-2,040/mt CFR Japan for July-August loading for 20-80 mt volumes, flat week on week.
In the US, the spot price of old cast - feedstock for secondary aluminum alloy production - fell to 69-71/lb on a delivered basis Thursday, from 71-73 cents/lb Monday, according to Platts assessments. Platts price assessments for other scrap also fell by 1-4 cents/lb, tracking London Metal Exchange high-grade aluminum prices, which fell below $1,900/mt.
Unlike in the US market, AK5M2 offers to Japan have not fallen as some Russian suppliers align their offers to Japanese domestic scrap prices, which have remained high, a Japanese trader said.
Currently, the Japanese "aluminum base metal" feedstock with a similar specification as AK5M2 is around Yen 200-205/kg ex-warehouse, which amounts to $2,000-2,050/mt on a CFR basis excluding various local handling charges, the trader added.
Japanese scrap prices are rising due to a supply/demand imbalance, traders said. Scrap demand has picked as the weaker yen fuels use of locally produced aluminum alloys rather than imports. But scrap supply is not catching up as manufacturing plant run rates have only started to rise recently, traders said.
A third Japanese trader said Russian suppliers have also blamed high scrap prices in Russia for the high AK5M2 prices.
"Winter in Europe was long this year and [snow-covered] scrap facilities started to operate only recently," the trader said.
The third Japanese trader reported closing AK5M2 deals this week at $1,990-2,005/mt CFR Japan for 1% zinc and maximum 0.85% magnesium material.
AK5M2 alloy, or melted scrap aluminum, is used as feedstock for ADC12 secondary aluminum alloy production in Japan and southeast Asia.
One Japanese aluminum smelter source said offers for AK5M2 with 1% zinc and 0.85% magnesium were at $2,000-2,040/mt CFR Japan for July-August loading for 20-80 mt volumes, flat week on week.
In the US, the spot price of old cast - feedstock for secondary aluminum alloy production - fell to 69-71/lb on a delivered basis Thursday, from 71-73 cents/lb Monday, according to Platts assessments. Platts price assessments for other scrap also fell by 1-4 cents/lb, tracking London Metal Exchange high-grade aluminum prices, which fell below $1,900/mt.
Unlike in the US market, AK5M2 offers to Japan have not fallen as some Russian suppliers align their offers to Japanese domestic scrap prices, which have remained high, a Japanese trader said.
Currently, the Japanese "aluminum base metal" feedstock with a similar specification as AK5M2 is around Yen 200-205/kg ex-warehouse, which amounts to $2,000-2,050/mt on a CFR basis excluding various local handling charges, the trader added.
Japanese scrap prices are rising due to a supply/demand imbalance, traders said. Scrap demand has picked as the weaker yen fuels use of locally produced aluminum alloys rather than imports. But scrap supply is not catching up as manufacturing plant run rates have only started to rise recently, traders said.
A third Japanese trader said Russian suppliers have also blamed high scrap prices in Russia for the high AK5M2 prices.
"Winter in Europe was long this year and [snow-covered] scrap facilities started to operate only recently," the trader said.
The third Japanese trader reported closing AK5M2 deals this week at $1,990-2,005/mt CFR Japan for 1% zinc and maximum 0.85% magnesium material.
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