Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Aluminum mill prices remain strong but have begun to even out as the market finds a balance between scrap supply and demand. The LME aluminum market climbed late last week and continued to rise higher on Tuesday after being closed for the UK bank holiday on August 31.


The spread for mill-grade 1100 & 3003 clips widened by 2.2¢/lb to 8¢/lb under the three-month LME aluminum contract on Tuesday while the weekly Davis Index for the grade was flat at 74.5¢/lb delivered US consumer.


The spread for scrap 6063 was weaker at 6¢/lb under the three-month LME aluminum contract, while the index for the grade increased by 0.2¢/lb to 76.5¢/lb delivered US consumer. The weekly spread for mill-grade MLC was worse by 2.3¢/lb at 28¢/lb, while the index for the grade decreased by 0.3¢/lb to 54.3¢/lb delivered US consumer.


The weekly Davis Index for mill grade painted siding inched up by 0.2¢/lb to 52.5¢/lb, higher, while its spread was wider by 1.8¢/lb, at 30¢/lb under the three-month LME contract. Litho sheet’s spread also widen by 1.1¢/lb to 14.5¢/lb while the Davis Index for the grade increased by 0.9¢/lb to 68¢/lb.


The three-month LME contract closed on Tuesday at $1,818/mt, up by $44.50/mt from $1,773.50/mt on August 25.  


Supply and demand have balanced over the past week with more scrap material becoming available across various grades. Industrial scrap activity has picked up despite some lower volumes across retail sales due to the heat in the Midwest and Southern US. Freight still remains an issue for aluminum scrap suppliers. 


Overall, this month looks to be solid for aluminum mills who anticipate moving into October with decent orders. Beyond October, all eyes are focused on the outcome of the US elections and its impact on economic recovery.

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