Al Scrap Market Price to Drop Again in Tokyo

Aluminium scrap market price would decrease again around Tokyo. Secondary alloyed aluminium makers and the scrap dealers started price negotiation for second half of June this week. The makers try to reduce the scrap purchase price by 5 yen per kilogram due to weak primary aluminium ingot price at offshore market and higher yen exchange rate.

Primary aluminium ingot price is around US$ 1,950 per tonne for future price at London Metal Exchange, which is the lowest level in the year. Local secondary alloyed aluminium makers around Tokyo try to reduce the scrap purchase price under buyers’ pressure for lower alloy selling price. The makers try to reduce scrap purchase price to 139-142 yen per kg for new cutting scrap and 95-100 yen for alloy turning scrap.

The dealers try to keep the scrap selling price unchanged. One dealer source said the dealer cannot cut the price when the scrap supply gets tight due to seasonal factor.

The dealers’ scrap selling price is decreasing since April. However, the dealers apparently cannot reduce the purchase price to meet decrease of selling price under severe competition for the scrap purchase.