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Mill-grade aluminum scrap follows LME down

Keywords: Tags  aluminum scrap, scrap prices, LME, London Metal Exchange, aluminum, Nasaac, A380.1, Nathan Laliberte

NEW YORK — Secondary mill-grade aluminum scrap prices weakened Feb. 7, with market participants noting worsening margins on slightly higher demand.

Prices for 5052 segregated low-copper alloy clips fell to a range of 96 to 98 cents per pound from 97 to 99 cents on Feb. 4, while 3105 clips decreased to 85 to 87 cents per pound from 86 to 88 cents.

"I think the terminal market is range-bound," one mill-grade buyer said. "At this point, we would have to see a narrowing of spreads for scrap prices to increase."

Mill-grade mixed low copper alloy clips also trended with terminal markets, falling 1 cent to 83 to 85 cents per pound from 84 to 86 cents, while painted siding weakened to 78 to 80 cents per pound from 79 to 81 cents previously.

"We’re still pretty busy," one mill-grade seller noted. "Our volumes are good, but margins definitely need to improve."

The cash primary aluminum contract on the London Metal Exchange ended the official session at $2,066.50 per tonne (93.7 cents per pound) Feb. 8 up 50 cents from a day earlier but down from $2,079 per tonne (94.3 cents per pound) Feb. 4.

Meanwhile, some secondary smelters’ aluminum scrap grades increased Feb. 7, sources told AMM.

Prices for secondary smelters’ mixed high copper clips rose 2 cents to 77 to 79 cents per pound from 75 to 77 cents, while painted siding increased to 74 to 76 cents per pound from 73 to 75 cents Feb. 4.

"Scrap is still tight," one secondary buyer said. "People are looking at heavy order books and are having trouble getting enough material. Scrap is out there, you just have to know where to find it."

The cash North American special aluminum alloy contract (Nasaac) closed the LME’s official session at $1,885.50 per tonne (85.5 cents per pound) Feb. 8, unchanged from a day earlier and down 1.8 percent from a three-week high of $1,920 per tonne (87.1 cents per pound) Feb. 4.

Prices for 356.1 trended with Nasaac Feb. 7, moving down to a range of $1.09 to $1.11 per pound from $1.10 to $1.12 previously.

Prices for A380.1 were unchanged at $1.03 to $1.04 per pound, with some sellers indicating that lower supplies of scrap might cause A380 prices to rise in the near term.

"We’re hearing incredible tightening on scrap right now," an A380 seller said. "Spot sales will have to be sky high for me to even think about selling. If I sell something today I have to make it, which means I have to rely on spot prices in a tightening scrap market. It’s risky."

All other secondary grades were unchanged.

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