US secondary aluminum alloys prices trended flat on Friday as the automotive industry struggles to get rolling again.   

 

The amount of aluminum alloy inventory available at the start of the COVID-19 related shutdowns was scheduled against much higher demand. Now that economic activity has resumed, most sales have been on a contractual basis, leaving the market well supplied with plenty of old inventory. Any new production is balancing out the current level of demand.

 

The weekly Davis Index for A380.1 remained at 67¢/lb delivered US consumer on Friday and held at 74¢/lb delivered for 319.1. The index for A360.1 decreased by 0.2¢/lb to 81¢/lb delivered US consumer and was unchanged at 82.3¢/lb delivered US for A413.1.

 

The three-month LME aluminum contract closed at $1,586.50/mt on Friday, up by $33/mt from $1,553.50/mt on Jun 5.

 

Short scrap supplies have put pressure on secondary smelters to pay higher prices for scrap, on the front-end of the aluminum alloy supply chain, with offers from scrap dealers increasing from last week.  Smelters have pushed back, citing lower sales volumes at present that made it close to impossible to pay higher prices. The conversation has come back to pre-COVID-19 crisis levels when secondary smelters were pushing for A380.1 to break the 70¢/lb mark.  Smelters were unable to reach that number before the market took a pause as the world went into lockdown.

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