High Scrap Cost Suffers Alloyed Aluminium Makers’ Profitability

Alloyed aluminium makers around Tokyo apparently finish the price negotiation with scrap suppliers to keep the level for first half of July. The makers are suffered from the high scrap cost when they cannot increase the selling price.The alloy makers sought 5 yen per kg down for low grade scrap but the dealers resisted the down under higher international primary ingot market and tight domestic scrap supply. The alloy makers avoided hike while light metal rerollers accepted 5 yen hike for high grade scrap. Some alloy makers lose money due to higher cost and low level selling price. Some makers reduce the operation by around 5% due to lower demand by automakers but the operation level is still high and scrap supply is still tight. Aluminium alloy makers around Osaka settled the scrap price negotiation to keep the level for June shipment at the regular based settlement after the shipment. Some makers succeeded to reduce the price by 2-3 yen per kg.