Demand for Low Grade Al Scrap Stays Stagnant in Tokyo

Demand for low grade aluminium scrap hasn’t shown a recovery sign around Tokyo. Local secondary aluminium alloy makers, the main consumer of aluminium scrap, hold much inventory of AK5M2, Russia’s secondary aluminium ingot, and keeps conservative stances to procure domestic aluminium scrap.

Japanese secondary aluminium ingot import from Russia, most of which is supposed as AK5M2, was approximately 19,000 tonnes in September, according to Ministry of Finance. The import volume kept as high as August. Unit price of AK5M2 imported from Russia is calculated at 142 yen per kilogram. The price seems relatively cheap against domestic aluminium scrap price.

Local secondary aluminium makers pay 115-110 yen per kg to purchase low grade aluminium sash scrap at scrap dealers’ sites without freight. A scrap dealer source said it is recently difficult to find buyers at 110-115 yen. The market price appears weak.

Offers for Japanese aluminium scrap have rapidly increased from South Korea since mid October. Scrap dealers expected for export expansion. However, offer price was low and most price negotiations failed, according to another scrap dealer.

Local demand for low grade aluminium scrap may recover toward the end of this year is secondary aluminium makers consume existent AK5M2 inventory.