Imported aluminum scrap prices continued to pull back, with the import window gradually improving
This week, imported aluminum scrap prices in China continued to pull back slightly. SMM data showed that the price of imported shredded zorba at Ningbo port was revised down from 21,920 yuan/mt to 21,820 yuan/mt, while at Tianjin port it dropped from 21,970 yuan/mt to 21,770 yuan/mt, with the decline narrowing WoW.
An SMM survey learned that, with overseas aluminum scrap and ADC12 offers continuing to pull back, orders for imported aluminum scrap and cast aluminum alloys from Southeast Asia to the Guangdong region have recently increased compared to the prior period, and the import window has improved further. However, new transactions remained concentrated mainly on certain lower-priced resources and long-term cooperative clients, leaving spot market trading activity still limited.
Industry sources indicated that if prices outside China continue to correct, import profits are expected to recover further, and imports may gradually rebound in H2.
The Southeast Asian aluminum scrap market diverged, with demand still dictating market trends
This week, the overall performance of the Southeast Asian aluminum scrap market diverged.
In the Malaysian market, tense scrap prices held steady at $2,500-2,700/mt; talon prices rebounded slightly to MYR 13,000-14,500/mt, reflecting relatively tight supply for certain high-grade wire and cable scrap; UBC prices pulled back slightly to MYR 9,250-10,000/mt.
In contrast, the Thai market remained under pressure, with talon prices adjusted to THB 104,000-110,000/mt and UBC prices further pulling back to THB 76,000-82,000/mt, as overall demand remained sluggish.
An SMM survey showed that most downstream enterprises are still purchasing only based on rigid demand, with market transactions staying sluggish. Although supply is relatively tight for some high-quality aluminum scrap, the slow recovery in end-use consumption left overall prices lacking sustained upward momentum, causing market trading logic to return to supply-demand fundamentals.
ADC12 offers continued to probe lower, with market transactions remaining sluggish
The Southeast Asian ADC12 market continued to be in the doldrums this week.
Malaysia's domestic trade ADC12 price held steady at MYR 12.85/kg, while FOB offers were revised down from $3,135/mt to $3,120/mt. Thailand's domestic trade price remained at THB 104.5/kg, while FOB offers pulled back from $3,130/mt to $3,100/mt.
Although offers continued to decline, the improvement in actual market transactions was limited.
An SMM survey learned that mainstream ADC12 offers in Southeast Asia have now dropped to around $3,050/mt, with actual transaction prices typically needing to be $50-60/mt lower than offers. Some traders noted that new orders in the market are currently scarce, with enterprises still mainly executing earlier high-priced orders. Against the backdrop of the traditional off-season, transactions slowed down notably.
Meanwhile, the converted export price of China's die-cast aluminum alloy has approached $3,000/mt, further compressing the room for Southeast Asian ADC12 export offers. Some enterprises reported that export business back to China is still dominated by long-term orders. Although recent import orders have seen an increase, new spot transactions remain limited.
Hot Topics
This week, the focus of the overseas aluminum scrap and secondary aluminum market remained on the pace of demand recovery, changes in the import window, and global aluminum scrap resource policy. As overseas ADC12 and aluminum scrap offers continue to pull back, the market is widely monitoring the improvement in China's import profits. Some Southeast Asian resources have already started flowing back to China, but new transactions are still dominated by long-term orders, with spot demand recovery remaining limited. At the same time, the terminal automotive and die-casting industries are still in the traditional off-season, with downstream procurement maintained on a rigid demand basis and enterprises generally focusing on controlling inventory and reducing procurement costs. On the policy front, measures such as the EU's proposed 15% export tax on aluminum scrap and the US tightening aluminum scrap resource management continue to draw market attention. Industry participants believe that if officially implemented, these policies will further impact global aluminum scrap trade flows and the supply landscape for high-grade aluminum scrap. Overall, current market focus is gradually shifting from supply disruptions to demand recovery and changes in trade flows.
SMM Outlook
SMM believes the overseas secondary aluminum market will remain in the doldrums and consolidate on a subdued note in the near term.
The market is still characterized by a weak supply-demand situation, with downstream consumption recovering slowly and enterprises purchasing mainly on rigid demand. Aluminum scrap and ADC12 prices are expected to remain under pressure. However, with overseas prices continuing to pull back, China's import window has already shown signs of improvement compared to the prior period. If import profits recover further, the volume of Southeast Asian resources flowing to China is expected to increase in H2.
Going forward, the market still needs to focus on LME aluminum price trends, changes in China's import profits, progress on resource protection policies in Europe and the US, and demand recovery in the terminal automotive and die-casting industries. These factors will remain key variables influencing the trend of the overseas secondary aluminum market and global aluminum scrap trade flows in H2.
