Bears Force Aluminum Prices to Retreat, Baled UBC Prices Drop by up to 250 Yuan/mt in a Single Day [Daily Review of Aluminum Scrap]

SMM, June 3 News:

Today, spot primary aluminum prices fell by 170 yuan/mt compared to the previous trading day. SMM A00 aluminum ingot prices closed at 20,120 yuan/mt. Aluminum scrap market prices adjusted downward overall, with varying price adjustments for some products in different regions. As the off-season in June begins, downstream scrap utilisation enterprises are experiencing weak order releases, with procurement mainly driven by immediate needs.

Today, the centralized quoted prices for baled UBC aluminum scrap range from 15,000 to 15,600 yuan/mt (tax not included), while the centralized quoted prices for shredded aluminum tense scrap range from 15,500 to 17,000 yuan/mt (tax not included). By region, Shanghai, Jiangxi, Jiangsu, Henan, Shandong, and other places closely track aluminum prices, with price adjustments ranging from 100 to 150 yuan/mt. Quotations in Guizhou and Foshan are relatively firm, with price adjustments lagging behind aluminum prices, ranging from 50 to 100 yuan/mt. By product, the overall prices of baled UBC aluminum scrap have retreated, with single-day decreases of 250 yuan/mt in Sichuan, Chongqing, Shanghai, and Zhejiang, and single-day decreases of 100 yuan/mt in Henan, Jiangxi, Hunan, and Foshan. For shredded aluminum tense scrap, the overall quoted prices have decreased by 100 to 150 yuan/mt.

In the short term, aluminum scrap market prices are expected to continue fluctuating at highs. The tight supply situation for aluminum tense scrap is unlikely to change, providing solid price support. Wrought aluminum alloy scrap will continue to fluctuate rangebound with primary aluminum, but the accumulated risk of a high-level correction in primary aluminum prices, combined with weak demand during the off-season, limits upside room. For downstream scrap utilisation enterprises, cost pressures and weak terminal orders continue to compete, with operating rates likely to remain low. The narrowing of import losses may partially alleviate supply pressures, but the transmission effect will be limited. Regional and product price differences may further diverge. Tight supply in South China and other regions may support localized price increases, while prices in regions with weak demand will face downward pressure.

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