Preview [SMM Analysis] the fifth batch of waste aluminum approval documents loose continuation or improvement of domestic waste aluminum shortage situation

SMM4, 13 Mar: according to the import quota of waste copper and waste aluminum announced by China solid waste Chemicals Management Network on April 10, the approved import volume of the fifth batch of aluminum scrap materials totaled 191100 tons, a significant increase over the previous month, involving more than 60 approved enterprises, so it seems that waste aluminum import has not been hindered for the time being.

According to SMM statistics, the first five batches of waste aluminum approval documents totaled 475600 tons in 2020. It is reported that from January to April 2019, according to customs data, the import of waste aluminum was 490000 tons, while the import of waste aluminum from January to February 2020 was only 122000 tons, down 40.7 percent from the same period last year. There are still a large number of approval documents remaining. At present, approval is not the main problem restricting the import of waste aluminum.

In view of this, can imported waste aluminum team domestic waste aluminum shortage problem bring some improvement?

SMM believes that the imported waste aluminum has a certain relief to the domestic waste aluminum gap, but its supplementary pace to the domestic is relatively slow, and can not quickly solve the problem of domestic waste aluminum supply shortage. There are two reasons, one is that since July 2017, the import of waste aluminum has cancelled the agent import of waste aluminum, and processing enterprises need to import it directly, which has caused a certain hindrance to the domestic circulation of imported waste aluminum. At present, under the background of weak consumption of recycled aluminum at home and abroad, recycled aluminum enterprises often adjust the rhythm of import waste aluminum according to demand, and it is difficult to produce explosive import increment, and the actual use of waste aluminum approval documents is relatively slow. Second, because the outbreak of the overseas epidemic was later than at home and had a significant impact only in the middle and late March, it is conservatively estimated that the overseas epidemic can not be controlled in April, so the impact on the production and transportation of overseas waste aluminum will also continue. the blockade of some countries has directly cut off some of the sources of imported waste aluminum.

Note: 2018-2019 is the actual import of waste aluminum, Q1 is the actual approval amount in 2020, and Q2-Q4 is the forecast of the import of waste aluminum.

Now that the supply of waste aluminum market remains tight, the price of waste aluminum remains stable, and if the subsequent import of waste aluminum increases, will its price be suppressed to a certain extent?

SMM believes that the supply and demand of overseas waste aluminum is in a double weak state, but relatively speaking, the demand side shrinks more significantly. As a result, prices have fallen back to a certain extent, and the trend will not be reversed until the overseas epidemic is under control. At present, the price of imported car slices has fallen to US $850 / ton. Due to the poor liquidity of domestic waste aluminum and the slow decline of prices, the advantage of imported waste aluminum is still relatively obvious. it is expected that with the gradual inflow of imported waste aluminum into China, the corresponding recycled aluminum ADC12 price will continue to impact the market and suppress the domestic waste aluminum price.

Attached list of the fifth batch of aluminium scrap

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