India: Imported aluminium scrap prices soften w-o-w tracking LME aluminium decline
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- Cautious buying weighs on imported scrap prices
- Softer global cues weigh on domestic market
India's imported aluminium scrap prices declined sharply w-o-w, tracking continued weakness in LME aluminium prices and subdued buying activity.
According to BigMint's latest assessment for CFR Nhava Sheva deliveries, UK-origin zorba 95-5 scrap prices declined by $60/t w-o-w to $2,965/t from $3,025/t previously. Meanwhile, US-origin tense 6-7% scrap prices decreased by $55/t w-o-w to $2,730/t from $2,785/t last week.
LME aluminium retreats w-o-w below $3,500/t
Three-month aluminium prices on the London Metal Exchange (LME) traded lower w-o-w, closing at $3,380/t on 16 June against $3,586/t on 9 June, down by $206/t or 5.7% w-o-w.
LME aluminium prices declined over the week, with three-month prices falling below $3,500/t despite continued reductions in exchange inventories. Broader weakness across cash and futures contracts outweighed the support from lower warehouse stocks, resulting in a correction in aluminium prices.
Meanwhile, LME aluminium inventories declined by 11,450 t, or 3.5% w-o-w, to 319,500 t on 15 June from 330,950 t on 8 June.
Market scenario
India's imported aluminium scrap prices declined sharply w-o-w, tracking the continued correction in LME aluminium prices and subdued buying activity.
Market participants remained cautious following the sharp fall in LME prices, creating uncertainty over near-term pricing direction. While some sellers considered liquidating inventories, many preferred to hold material in anticipation of a recovery in benchmark prices.
Despite the decline in LME aluminium, imported scrap prices did not witness a proportional correction, as suppliers continued to maintain relatively firm offers due to constrained scrap availability.
Tight supply conditions have limited the scope for further price declines, with market participants expecting aluminium prices to strengthen once broader market conditions stabilize.
On the domestic front, trading activity also weakened. Following softer global aluminium prices, the domestic market also witnessed a decline.Chinese silicon prices
According to BigMint's latest assessment, China-origin silicon metal 553 prices remained stable w-o-w at $1,435/t CFR Mundra, supported by firm import offers, steady demand, and stable market sentiment.
Outlook
Imported aluminium scrap prices are expected to remain under pressure in the near term, influenced by LME price movements and cautious buying activity. However, tight scrap availability and firm supplier offers are likely to limit further downside, while any recovery in LME aluminium prices could provide support to imported scrap prices.
