Prices for US secondary aluminum smelter scrap began to trend sideways to down after the US ferrous market settled at higher prices last week and on anticipation of better flows.
The weekly Davis Index for all the aluminum shredder grades diverged on Wednesday, with Twitch and Tweak giving ground and Zorba ticking up slightly. The weekly index for Zorba moved up by 0.8¢/lb, to 43¢/lb delivered US consumer. Tweak declined by 0.3¢/lb to 44¢/lb delivered, while Twitch was down by 0.6¢/lb at 49.9¢/lb.
The supply for the aluminum shredder grades was tight so far amid a suppressed ferrous market that had caused auto shredders to slow down their operations. Now, with the ferrous market increasing by $40/gt or more in September, auto shredders should see an uptick in scrap auto sales across there scales.
The index for Old Cast was lower by 0.5¢/lb at 44.5¢/lb delivered US consumer on Wednesday while Old Sheet decreased by 0.2¢/lb to 44.8¢/lb delivered US consumer. The Davis Index for high-grade turnings increased by 0.3¢/lb to 37.5¢/lb.
The three-month LME aluminum contract closed at $1,777.50/mt on Wednesday, down by $38/mt from $1,815.50/mt on September 2.
The flattening of the price curve for the secondary scrap market has created an opportunity for secondary aluminum alloy producers to capture more margin on their sales due to robust demand for finished secondary alloys across the globe.