NEW YORK Scrap aluminum wheel prices continued to fall this week due to weakening terminal markets coupled with lower demand.
Free-market transaction prices for 356.1 wheels have fallen to 79 to 83 cents per pound from 82 to 84 cents Oct. 28, according to traders.
Unlike some secondary items, wheel prices often are directly tied to movements on the London Metal Exchange, one seller told AMM. "Some of the bigger smelters have contracts that are directly tied to the LME," he said, adding that some of his bigger consumers were "sitting on inventory" and "waiting for things to pop in the first quarter of next year."
A second seller said he had seen a steep drop in demand since the beginning of November. "Its very soft right now," he said. "I think most consumers are long on inventories and automakers have their fill for the time being."
The primary aluminum cash contract on the LME ended the official session Nov. 11 at $1,760.50 per tonne (79.9 cents per pound), down 4.3 percent from $1,839 per tonne (83.4 cents per pound) Oct. 28.
Prices for 356.1 alloy have remained steady over the past month at $1.09 to $1.11 per pound, although several participants warned that if the LME continues to fall, secondary aluminum alloy prices likely will follow suit.