Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

US Aluminum mill and extruder scrap prices trended flat, except for 5052 scrap, which moved higher on demand from southern aluminum mills. On the other hand, LME aluminum prices ticked down over the week tightening the spreads for aluminum scrap.


The spread for mill-grade 1100 & 3003 clips narrowed by 0.8¢/lb to 4¢/lb under the three-month LME aluminum contract on Tuesday while the weekly Davis Index for the grade decreased by 0.1¢/lb to 77¢/lb delivered US consumer. The index for 5052 moved higher by 3.8¢/lb to 82¢/lb delivered while the grade’s spread tightened by 2.4¢/lb to 1.3¢/lb under the three-month LME aluminum contract. 


The spread for scrap 6063 was stronger at 1.4¢/lb under the three-month LME aluminum contract, while the index for the grade decreased by 2.3¢/lb to 76.4¢/lb delivered US consumer. The weekly spread for mill-grade MLC narrowed by 2.6¢/lb to 24.5¢/lb, while the index for the category increased by 0.9¢/lb to 55.7¢/lb delivered US consumer.


Mill grade painted siding declined by 2.6¢/lb to 53.3¢/lb, while the spread was wider by 1.4¢/lb, at 29.1¢/lb under the three-month LME contract. The Litho sheet grade saw the spread tighten by 2.6¢/lb to 8.3¢/lb while the Davis Index for the grade increased by 0.2/lb to 72.7¢/lb.


The three-month LME contract closed on Tuesday at $1,785/mt, down from $1,806.5/mt on September 15.  


Better economic activity and strong demand in the southern US has propped up aluminum scrap prices for now even though the aluminum export market continues to put pressure on the domestic market. In fact, buyers from India have been looking for material with renewed vigor over the week, thus strengthening the US aluminum export market, where offers are priced higher than the US market. As a result, supply is shifting towards the coast leaving limited tonnes for domestic participants and firming up prices.

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