Recycled Al Supply Looses Much Despite of Low Price, Japan

Supply of recycled aluminium ingot, a main material for secondary aluminium alloy, becomes sharply surplus against the demand in Japan. Japanese secondary aluminium alloy makers are reducing procurement of recycled aluminium ingot when they implement output reductions. At the same time, arrivals of high-price recycled aluminium ingot are scheduled from Russia to alloy makers.

The market price is currently around 130-140 yen per kilogram for recycled aluminium ingot made in Japan. The price plunged to less than halved from the peak for April-June 2008. Russian AK5M2 price became below C&F $1,300 per tonne in early November. Most of Japanese recycled aluminium import comes from Russia. A Japanese dealer source said AK5M2 price rebounded in November but the price still stays as half as the yearly peak.

Japanese secondary aluminium alloy makers are significantly decreasing recycled aluminium purchase though the market price plunged down. Alloy makers contracted overseas recycled aluminium ingot at high price level during August-September. These contracted ingots are scheduled to arrive in Japan toward January 2009. An alloy maker source said they cannot purchase surplus material despite of lowering price.

Japanese import price of Russian recycled aluminium ingot is around 240-250 yen per kg. The import price is higher by more than 100 yen compared with the current offer price.