Secondary Al Alloy Makers to Approve Higher Scrap Price in March

Secondary aluminium alloy makers and aluminium scrap dealers have entered final phase of price negotiation for aluminium scrap shipping in the first half of March. Some alloy makers and dealers have already agreed in price hike by 12-13 yen per kilogram for high grade scrap and by 7-8 yen per kg for low grade scrap to reflect upsurge of primary aluminium price.Domestic market price of primary aluminium ingot is 330-335 yen per kg, up by over 60 yen from the recent bottom in January. Following the higher primary aluminium price, scrap dealers offered secondary alloy makers hike by 15 yen per kg for high grade scrap and by 10 yen per kg for low grade scrap. Secondary alloy makers mostly disapprove the hike since they could not raise their product selling price enough so far.Aluminium scrap supply maintains tight while secondary aluminium alloy makers keep full production to meet strong demand from automobile industry. Wide range hike would be unavoidable with higher aluminium price and tighter scrap supply.Secondary alloy makers have no choice to increase material procurement from overseas markets when Russian aluminium (AK5M2) price is soaring to above US$ 2,800 per tonne, the main overseas material. Secondary alloy makers seem to purchase aluminium scrap generated in domestic market despite remarkably higher price.