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

The Davis Index for P1020A continued to climb on Monday on supply concerns after Canada’s aluminum exports became 10pc more expensive on August 16.


The Davis Index for P1020A was higher by 1.6¢/lb at 13.8¢/lb delivered US under the three-month LME Aluminum contract on Monday. Simultaneously, the 6063-billet premium marked its first movement since Q1 2020 for the extruded billet, rising by two-tenths of a penny to 6.2¢/lb delivered under the same LME contract.


Market participants expect this is just the beginning of what could be a tight supply environment but have stated that cash sales are still not a large portion of the market. Buyers, on the other hand, seem to be looking to lock in lower prices for the time being as scrap remains tight. With concerns over grade availability, some scrap consumers may return to the primary market to help fill gaps in tonnages or chemistry, pushing the price or premiums higher.


The three-month LME aluminum contract closed on Monday at $1,757/mt down by $9/mt from $1,766/mt on August 10.


The higher premiums have attracted interest from other suppliers outside the US as well.  A market participant noted receiving calls from those they have not heard from since the US premium dropped below the 16-17¢/lb range, a range that can be profitable for importers even with the tariffs.As the premium inches up, it may create room once again for imports from other countries if Canada decides to stay out to the US market.

Leave a Reply

Your email address will not be published.