Cast Aluminum Alloy Futures Rise on Listing Day, Aluminum Scrap Market Remains Calm [Daily Review of Aluminum Scrap]

SMM June 10 News:

Today, spot primary aluminum prices fell slightly by 50 yuan/mt compared to the previous trading day. SMM A00 aluminum ingot prices closed at 20,160 yuan/mt, while aluminum scrap market prices generally remained stable. 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 concentrated quotes for baled UBC aluminum scrap range from 15,000 to 15,500 yuan/mt (tax excluded), while shredded aluminum tense scrap quotes range from 15,500 to 17,000 yuan/mt (tax excluded). Regionally, regions such as Shanghai, Jiangsu, and Shandong closely track aluminum prices, with price adjustments ranging from 0 to 50 yuan/mt. In contrast, regions like Jiangxi, Foshan, and Guizhou lag behind aluminum price adjustments, with quotes remaining unchanged from yesterday. By product, baled UBC prices remained generally unchanged from yesterday, while bare bright aluminum wire prices fell by 100 yuan/mt.

It is expected that the aluminum scrap market will continue to fluctuate at highs. The tight supply of 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 risk of a high-level correction in primary aluminum prices, combined with weak demand during the off-season, may suppress upside room. The operating rate of downstream secondary aluminum enterprises may remain low, with a difficult balance between costs and orders. Regarding reverse invoicing, regions such as Jiangxi, Anhui, and Hubei are actively promoting its implementation among producers and suppliers. According to feedback from some scrap utilisation enterprises, the tax costs arising from reverse invoicing will be shared by suppliers and producers, ultimately being passed on to raw material prices. On the other hand, cast aluminum alloy futures were listed today, June 10. Futures arbitrage activities may temporarily boost market activity in the secondary aluminum alloy market. As aluminum scrap is a core production raw material, its price sensitivity may be further heightened.

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