The Southeast Asian secondary aluminium market remained under pressure this week, with both aluminium scrap and ADC12 prices continuing to soften. As LME aluminium prices traded in a weak range and downstream demand recovered slowly, buyers largely maintained hand-to-mouth purchasing, resulting in subdued trading activity. Meanwhile, declining overseas prices have gradually improved China's import economics, leading to a modest increase in material flowing from Southeast Asia into China, although spot transactions have yet to recover meaningfully.
Imported Aluminium Scrap Prices Continue to Ease as Import Window Gradually Improves
Imported aluminium scrap prices in China continued to edge lower this week. According to SMM data, imported shredded aluminium scrap at Ningbo Port declined from RMB 21,920/mt to RMB 21,820/mt, while prices at Tianjin Port fell from RMB 21,970/mt to RMB 21,770/mt, with the pace of decline moderating compared to the previous week.
SMM learned through market participants that as overseas aluminium scrap and ADC12 prices continued to fall, import orders for Southeast Asian aluminium scrap and casting alloys into Guangdong increased compared with previous weeks, indicating a gradual improvement in the import window. However, most new transactions remained concentrated in lower-priced cargoes and long-term contractual business, while spot market activity was still relatively limited.
Market participants believe that should overseas prices continue to decline, import margins are likely to improve further, potentially supporting a gradual recovery in import volumes during the second half of the year.
Southeast Asian Aluminium Scrap Market Diverges as Demand Continues to Drive Prices
The Southeast Asian aluminium scrap market showed mixed performance this week.
In Malaysia, Tense prices remained unchanged at USD 2,500–2,700/mt. Talon prices increased slightly to MYR 13,000–14,500/mt, reflecting relatively tight availability of high-grade cable scrap, while UBC prices edged lower to MYR 9,250–10,000/mt.
In contrast, Thailand remained under pressure. Talon prices adjusted to THB 104,000–110,000/mt, while UBC prices declined further to THB 76,000–82,000/mt, reflecting continued weak downstream demand.
According to SMM's market survey, most consumers continued to purchase only on an as-needed basis, with overall trading activity remaining subdued. Although supply of certain premium scrap grades remained relatively tight, sluggish end-user demand continued to limit upward price momentum, and market fundamentals once again became the dominant pricing driver.
ADC12 Prices Continue to Decline While Trading Activity Remains Weak
The Southeast Asian ADC12 market continued to soften this week. In Malaysia, domestic ADC12 prices remained stable at MYR 12.85/kg, while FOB prices eased from USD 3,135/mt to USD 3,120/mt. In Thailand, domestic prices held at THB 104.5/kg, while FOB prices declined from USD 3,130/mt to USD 3,100/mt.
Despite lower quotations, actual trading remained sluggish. According to SMM research, mainstream Southeast Asian ADC12 offers have fallen to around USD 3,050/mt, while actual transaction prices are generally USD 50–60/mt below quoted levels. Several traders noted that new orders remained scarce, with most producers still fulfilling previously signed higher-priced contracts. Seasonal demand weakness further weighed on market activity. Meanwhile, the export parity price for Chinese casting aluminium alloys has approached USD 3,000/mt, further narrowing pricing flexibility for Southeast Asian exporters. Some producers also reported that exports to China continue to be dominated by long-term contracts. Although import inquiries from China have increased recently, spot transactions remain relatively limited.
Market Focus
This week, market attention remained focused on the pace of demand recovery, changes in China's import window, and global aluminium scrap policies.
As overseas aluminium scrap and ADC12 prices continued to decline, market participants closely monitored improvements in China's import margins. Some Southeast Asian material has begun flowing back into the Chinese market, although new transactions remain largely concentrated in long-term contractual business, with spot demand still recovering slowly.
At the same time, the automotive and die-casting industries remain in the traditional seasonal slowdown, with downstream buyers continuing to purchase only on an as-needed basis while prioritising inventory control and lower procurement costs.
On the policy front, the European Union's proposed aluminium scrap export tax and ongoing discussions in the United States regarding tighter aluminium scrap resource management continued to attract market attention. Industry participants believe that if these measures are eventually implemented, they could reshape global aluminium scrap trade flows and affect the availability of high-quality scrap. Overall, market focus has gradually shifted away from supply disruptions toward demand recovery and changes in international trade flows.
SMM Outlook
SMM expects the overseas secondary aluminium market to remain in a weak but range-bound trend in the near term.
The market continues to face both weak supply-demand fundamentals and sluggish downstream consumption, with buyers maintaining cautious, demand-driven purchasing strategies. As a result, aluminium scrap and ADC12 prices are expected to remain under pressure.
Nevertheless, as overseas prices continue to soften, China's import window has shown signs of improvement. Should import profitability recover further, more Southeast Asian material is expected to flow back into China during the second half of the year.
Going forward, market participants should closely monitor LME aluminium price movements, China's import margins, developments in European and U.S. scrap resource policies, and demand recovery in the automotive and die-casting sectors, as these factors are expected to remain the key drivers of the global secondary aluminium market and international aluminium scrap trade flows in the months ahead.
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