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

The weekly Davis Index for A380.1 rose by 1¢/lb on Friday to $1.187/lb delivered US consumer as the labor shortage in the smelter industry created further supply constraints. 


Production is running at a nearly full pace even as smelters are drifting into vacation mode with most looking to start maintenance and optimization in the coming weeks. Labor, however, has become a pressing issue as lower wages have made smelter jobs unfeasible with many preferring higher unemployment benefits. Due to this, many smelters aren’t able to meet production schedules and delivery appointments, no matter the price. 


The index for A356.1 was flat at $1.37/lb delivered US consumer. Davis Index prices for A413.1 fell 1.8¢/lb to $1.355/lb delivered. A360.1 prices rose 1¢/lb at $1.363/lb delivered. The index for 319.1 ticked up a penny to $1.265/lb delivered. 


Shutdowns aside, smelters are banking on a demand boom in the latter part of this year as the automotive industry is expected to recover from the chip shortage, latest by early Q4. During the next month, secondary metal will be short due to closures, but full-scale supply, later on, will still not be able to keep up with growing demand from the automobile sector, especially with the electric push. Some manufacturers are considering ramp-ups to mitigate this danger but are wary because of the ongoing semiconductor issue. Besides, demand from every other sector outside of automotive is growing. 


The official LME Aluminium cash price settled Friday at $2,490/mt ($1.129/lb), up by $78/mt from Jun 4. 

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