US export aluminum scrap prices decreased over the past week after Southeast Asian buyers retreated on news of Chinese state reserves being released.
The weekly Davis Index for Taint/Tabor fell by 2.8¢/lb to 70¢/lb fas US port while Tense prices declined by 2.2¢/lb to 71.7¢/lb fas. Prices for A356 wheels slipped by 0.2¢/lb to 95.5¢/lb fas amid a wide range of deals heard in the market. Talk decreased by 19.5¢/lb over the week to $2.05/lb after LME and Comex copper declined.
With China, Malaysia, Mexico, and India effectively out of the market over the past week, South Korea remained the only active buyer though some bids were heard from India. Despite the ample amount of scrap available for export, the general sentiment remains tense with traders going into a wait and watch mode until the LME stabilizes.
In China, the market is volatile with the state reserve situation crashing the SHFE (Shanghai Futures Exchange) due to the uncertainty. Moreover, the new scrap regulations give customs the right to reject Zorba, including repolished and recleaned material. Due to this, Chinese smelters have now stopped buying and are trying to burn through their current inventory. There is definitely a shortage of scrap at these smelters, but no way to bring more in.
The weekly Davis Index for Zorba 95/2 declined by 4.5¢/lb to 69.5¢/lb fas US port while Zorba 99/3 fell 2¢/lb to 70.5¢/lb fas US port. Both prices settled close to each other but since India was quoting high numbers last week, the drop seemed bigger.
The official LME Aluminium cash price closed Thursday at $2,427.50/mt ($1.10/lb), down $43/mt from Jun 3.