Price Inversion Between ADC12 Secondary Aluminum Alloy And A00 Aluminum Will Deepen

SHANGHAI, Jun 16 (SMM) – ADC12 secondary aluminum alloy prices lost 100 yuan/mt from a week ago to 18,500 yuan/mt as of June 15.

Aluminum scrap prices barely fell amid tight supply, while ADC12 prices dropped due to poor demand and fierce market competition, leaving most producers in losses.

In terms of demand, downstream consumption remains weak at present. Die-casting factories report that orders in June are relatively stable compared with May, with almost no increase, and most of them purchase only as needed. For future demand, market players generally believe that demand will barely improve in July and August due to the impact of high temperature, but expect orders to increase in September.

On the supply side, orders at some large secondary aluminum alloy factories rebounded slightly, driving them to raise operating rates, but small and medium-sized factories were operating at a low capacity due to factors such as lack of orders, backlog of finished product inventory, and financial pressure. Overseas ADC12 offers were lowered to $2,200-2,240/mt, but importers still suffered losses due to weaker RMB.

The current price of ADC12 is lower than A00 aluminium, and the price difference between the two is still expanding. Given poor demand and fierce competition, the price of ADC12 will run on a weak note in the short term.