Southeast Asia Aluminum Scrap Market Flat, Import Prices into China Rebound Strongly

The recycled aluminum market in Southeast Asia remained relatively stable over the past week. Prices of major aluminum scrap grades mostly fluctuated within a narrow range, while domestic ADC12 aluminum alloy held at previous levels. Supported by high input material costs, export offer (FOB) prices for ADC12 edged up slightly.

In China, improved import margins pushed prices of imported aluminum scrap to continue their recovery, with a number of new cargoes expected to arrive at ports in mid-August.

1. Southeast Asia Aluminum Scrap: Mild Movements, Divergence Between Grades

Overall, aluminum scrap trading across Southeast Asian countries was mainly driven by producers' actual demand, while buyer sentiment remained cautious:

• Malaysia market:
• Tense: Held steady at USD 2,750/tonne.
• Talon: Down from MYR 13,950/tonne to MYR 13,500/tonne (approx. USD 3,300/tonne).
• UBC: Edged down to MYR 10,050/tonne (approx. USD 2,457/tonne).
• Thailand market:
• Talon: Ticked up to THB 109,800/tonne (approx. USD 3,268/tonne).
• UBC: Flat at THB 84,000/tonne (approx. USD 2,500/tonne).

High-quality grades such as UBC continued to outperform mixed casting scrap or aluminum cable, thanks to persistently tight market supply.

2. ADC12 Aluminum Alloy: FOB Prices Edge Up on Input Costs

Although purchasing from downstream sectors remained relatively weak, ADC12 aluminum alloy FOB prices in several countries still edged up slightly to offset scrap costs:

3. China: Imported Scrap Prices Sustain Upward Momentum

Buoyed by the rally in China's domestic aluminum prices, the import price spread (margin spread) widened. This made trading sentiment among traders more active:

• Ningbo Port: Shredded scrap price reached CNY 21,970/tonne (+500 CNY vs. the start of the week).
• Tianjin Port: Price rose to CNY 22,020/tonne (+500 CNY).

According to market reports, several import aluminum scrap purchase contracts were successfully concluded and are expected to arrive at ports around mid-August. However, downstream processors maintained a hand-to-mouth purchasing strategy and have not yet engaged in large-scale stockpiling.

4. Market Outlook

In the short term, the Southeast Asian recycled aluminum market is forecast to continue trading within a narrow range:

• Scrap supply: High-grade aluminum scrap will hold prices thanks to limited supply.
• Pressure on ADC12: ADC12 prices may face downward adjustment as downstream consumption shows no breakthrough.
• Supply-demand in China: The arrival of import cargoes in mid-August will add to spot supply; however, the overall pace of recovery still depends on purchasing from ancillary industries.

Key factors to watch closely:

• Aluminum price movements on the LME.
• The abundance of global scrap supply.
• Import price arbitrage opportunities into China.
• The pace of demand recovery from the automotive and die-casting sectors.