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US aluminum scrap prices slide on LME dip

Keywords: Tags  Aluminum scrap, mill-grade aluminum, A380.1, LME, Nasaac, scrap prices, Nathan Laliberte

NEW YORK — Prices for most secondary aluminum scrap grades fell April 4 as sources said unfavorable margins and weakening terminal markets continued to present significant headwinds to maintaining profitability.

“We’re busy on the sales end and when the weather starts to improve flow will get a little better,” one scrap buyer said. “But we’re still struggling to achieve proper margins.”

Secondary smelters’ mixed low copper clips fell 2 cents to 73 to 75 cents per pound from 75 to 77 cents previously, mixed high copper clips weakened to 73 to 74 cents per pound from 75 to 76 cents, mixed high zinc clips decreased to 68 to 69 cents per pound from 69 to 70 cents, and painted siding and mixed clips each moved to 71 to 73 cents per pound from 72 to 74 cents previously.

Aluminum-copper radiators also fell to $1.70 to $1.75 per pound from $1.73 to $1.78.

Domestic aluminum producers’ used beverage can (UBC) scrap prices eased to 75 to 76 cents per pound from 76 to 77 cents, as one UBC buyer said that “there is not a whole lot of material moving at the moment.”

The cash primary aluminum contract on the London Metal Exchange ended the official session at $1,845 per tonne (83.7 cents per pound) April 5, down 2.2 percent from $1,927 per tonne (87.4 cents per pound) a month earlier.

Meanwhile, prices for mill-grade aluminum scrap also weakened, with sources telling AMM that price declines were largely attributable to lower volumes and limited trading activity.

“Scrap isn’t coming in and it’s not moving out,” one mill-grade buyer said. “We’re in a bit of a standstill.”

Prices for 5052 segregated low-copper alloy clips fell to 88 to 90 cents per pound from 89 to 91 cents, 3105 clips declined to 80 to 82 cents per pound from 81 to 83 cents, mill-grade mixed low-copper alloy clips fell a penny to 78 to 80 cents per pound from 79 to 81 cents, and painted siding narrowed to 74 to 76 cents per pound from 74 to 77 cents.

Secondary alloy tags have held steady, with market players indicating that demand from the automotive sector was starting to improve.

“Volume is really strong right now,” one alloy producer said. “But it doesn’t matter because we’re working on super tight margins.”
Most producers put A380.1 sales at $1.04 to $1.05 per pound, with sources saying that attempts to sell at $1.06 were largely unsuccessful.

All other major alloys were unchanged, with 319.1 at $1.09 to $1.10 per pound, 356.1 at $1.11 to $1.12, and low-copper A360.1 and A413.1 alloys both at $1.11 to $1.12 per pound.

The LME’s cash North American special aluminum alloy contract (Nasaac) closed the official session at $1,770 per tonne (80.3 cents per pound) April 5. A day earlier, it sank to its lowest level since November 2009, closing the official session $1,760 per tonne (79.8 cents per pound).

Despite Nasaac’s plunge, sources said there was limited correlation between Nasaac’s published price and the secondary alloy market. “People are basing quotes off of the price of scrap, not Nasaac,” one alloy producer said. “It just doesn’t seem to carry as much weight as it used to.”

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