Japanese Secondary Al Makers to Lower Al Scrap Purchasing Prices

Aluminium scrap market price is likely to continue lowering around Tokyo. Major secondary aluminium alloy makers and aluminium scrap dealers seem to agree in price cut of all scrap items by 3-5 yen per kilogram for July 1-15 shipment. The main factor is price down of primary aluminium ingot by about 10 yen per kg from the monthly peak in late June. Alloy makers are inactive to procure domestic scrap due to high level arrivals of base metal AK5M2 from Russia.

Several alloy makers suggest they aim to lower purchasing price for high grade aluminium scrap to 150-160 yen per kg. As to low grade scrap mainly used for AD12.1 grade alloy, the makers eye 140 yen for machine scrap and 120-130 yen per kg for sash scrap. The makers also consider to lower UBC (used beverage can) purchasing price to around 110 yen from current 120 yen.

Alloy makers hold plenty inventories of Russian AK5M2 contracted at high price. Japanese import of secondary aluminium alloy ingot from Russia was 15,168 tonnes in May, according to Ministry of Finance. The import expanded by 3.4 times from a year earlier, most of which seems AK5M2. An alloy maker said the import seems to keep high volume for June-August. Some alloy makers decrease procurement of domestic aluminium scrap to consume high-price AK5M2 inventory in advance.