Aluminum prices fluctuate upward, with significant regional differentiation in aluminum scrap prices. [Daily Review of Aluminum Scrap]

SMM May 21 News:

Today, spot primary aluminum rebounded by 100 yuan/mt from the previous trading day. SMM A00 aluminum ingot prices closed at 20,310 yuan/mt. Regional price performances in the aluminum scrap market varied significantly. As we entered late May, with the transition between the off-season and peak season, downstream processing enterprises experienced weak order releases, and procurement was mainly driven by immediate needs.
Today, the concentrated quotes for baled UBC aluminum scrap ranged from 15,250 to 15,850 yuan/mt (tax excluded), while the concentrated quotes for shredded aluminum tense scrap ranged from 15,800 to 17,300 yuan/mt (tax-exclusive prices). Regionally, prices remained stable in multiple areas such as Hubei, Guizhou, and Anhui, with no overall adjustments made. Other regions, including Shanghai, Jiangsu, Henan, and Shandong, closely tracked aluminum prices, with price adjustments ranging from 50 to 100 yuan/mt. In Jiangxi, after an overall increase in aluminum scrap prices yesterday, today's quotes remained stable without following the changes in primary aluminum prices.

In terms of the price difference between A00 aluminum and aluminum scrap, the price difference between A00 aluminum and mechanical casting aluminum scrap in Shanghai narrowed by 8 yuan/mt from yesterday to 1,838 yuan/mt. The price difference between A00 aluminum and aluminum extrusion scrap in Foshan increased by 110 yuan/mt from yesterday to 1,493 yuan/mt.
In the short term, the aluminum scrap market may continue to fluctuate at highs. The tight supply situation for aluminum tense scrap products is unlikely to change, providing strong price support. Wrought aluminum alloy scrap products will still be dominated by fluctuations in primary aluminum prices, with narrow adjustments expected. Overall, during the transition period between the off-season and peak season, with weak supply and demand in the market, the differentiation between product types and regional price differences may further emerge. It is necessary to remain vigilant about macro risks such as policy shifts by the US Fed, geopolitical conflicts, which may trigger sharp fluctuations in primary aluminum prices, or concentrated production cuts by domestic secondary aluminum enterprises, which may put pressure on aluminum scrap prices.

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