Supply-side concerns triggered a sharp rise in primary aluminum prices, with spot aluminum scarp transactions being moderate

SHANGHAI, JAN 24 (SMM) –The average spot price of primary aluminum in east China increased by 230 yuan/mt to 18,980 yuan/mt; the average spot price of SMM Foshan primary aluminum increased by 240 yuan/mt to 19,120 yuan/mt. The primary aluminum prices rebounded strongly today, with domestic aluminum scrap prices following the increase. However, domestic aluminium scrap processing companies saw a low operating rate, and many aluminum scarp companies had CNY break. The domestic aluminum scarp market transactions became sluggish, and aluminum scrap prices failed to follow the increase. The overall performance in Jiangsu, Zhejiang and Shanghai were strong, while the south China and north China markets had smaller gains. In the short term: the EU plans to impose an embargo on Russian aluminum metal, triggering concerns about overseas supply and boosting the aluminum prices. However, as the aluminum scarp market lacks willingness to stock up before CNY holidays, and aluminum scarp transactions became sluggish, and prices may track swings of primary aluminum market.