Prices of US secondary aluminum smelter scrap increased amid automotive factory restarts and tight supply on Wednesday.
The weekly Davis Index for shredder grades increased on Wednesday, rising to 35.1¢/lb delivered US smelters from 34.5¢/lb delivered for tweak, and by 1.1¢/lb to 37.9¢/lb delivered for twitch. The index for zorba moved up by 0.03¢/lb, to 31.5¢/lb delivered.
The Davis Index for old cast ticked up by 0.071¢/lb to 34.1¢/lb delivered US smelters on Wednesday but decreased by 0.07¢/lb to 35.7¢/lb delivered for old sheet. The prices for both grades moved on the back of lower volumes compared to the previous week, indicating the continuing tightness in scrap supply.
The index for secondary MLC rose by 4.2¢/lb to 40.7¢/lb delivered US smelter and inched up by 0.07¢/lb to 33.8¢/lb delivered US for painted siding.
Automotive restarts have brought hope to many market participants. However, poor financial results for many along the supply chain and an expected round of bankruptcies before a more sustained recovery remains the dark cloud to the silver lining of factory restarts, especially since selling more material to buyers who are 100 days past due on payments is not an option.