Aluminum

CRU: Aluminum news roundup

Written by Matthew Abrams


Aluminum prices

The LME three-month price continued to strengthen through Friday, March 8, defending its position close to its five-week high and rising further to $2,262 per metric ton (mt), up 0.3%, on the day. Gains were also noted over the last week in other industrial metals, including copper, zinc, and lead. The price gains appeared to be due to weakness in the US dollar, which fell sharply against a basket of currencies after Fed Chairman Jerome Powell said on Wednesday that rate cuts were still expected this year.

Report indicates persistently weak US extrusion demand

The US Aluminum Association released its latest shipment report for extruded products. According to the report, shipments of extruded products totaled 367.1 million pounds in January 2024 – a drop of 10.4% year over year (y/y) but an increase of 28.8% month over month (m/m).

The report indicates a still struggling extrusions sector in the US. Overall, the sector has been in contraction since August 2022, and this trend does not look set to change any time soon. This contrasts with the sheet and plate report that last week showed a growth of 3.6% y/y as the sector continues its slow recovery since returning to growth in November last year.

Commerce announces extrusion subsidy determinations

The US Department of Commerce on Wednesday announced its preliminary finding that the governments of China, Indonesia, Mexico, and Turkey unfairly subsidize their aluminum extrusion industries. Commerce calculated affirmative preliminary countervailing duties from each country in the following ranges:

  • China: 15.41% to 169.66%
  • Indonesia: 6.69% to 43.56%
  • Mexico: 1.68% to 77.80%
  • Turkey: 1.45% to 147.53%

The US Aluminum Extruders Coalition and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union are all pushing the US government to impose duties, which they say are crucial to US producers and workers.

These duty rates are only for the countervailing duty investigations. They do not yet include the rates from the ongoing antidumping duty investigations of aluminum extrusions from China, Indonesia, Mexico, and Turkey, which will be added to the preliminary subsidy rates. The Commerce Department’s preliminary determinations in the antidumping duty cases on these four countries, as well as 10 other countries, are currently scheduled for early May 2024.

Granges inks deal with Scepter

Aluminum product manufacturer Granges has formed a 10-year partnership with recycler Scepter for delivery of scrap-based aluminum ingots as feedstock for Granges’ rolling and recycling plants in the United States.

“Securing access to recycled and low-carbon input materials is a key enabler for Granges to offer circular and sustainable aluminum solutions to its customers and achieve its 2040 net zero goal,” the Swedish-based group said.

Patrick Lawlor, president of Granges Americas, added: “Granges is committed to reducing the carbon footprint of our products and thereby also helping our customers on their decarbonization journey.”

The emissions’ intensity of the ingots is estimated to be 0.3/mt of CO2e/mt according to the company, which plans to power production processes with renewable electricity to further reduce the operations’ carbon footprint. Granges serves the HVAC, packaging, building, construction, and automotive sectors.

Chinese aluminum exports increase

According to the latest data by Chinese Customs, China exported 966,000 mt of unwrought aluminum and products in the first two months of 2024 – an increase of 9.7% y/y. That is down 6.6% compared to the same period in 2023 but up 14.7% compared to the same period in 2022. This report indicates that export volumes are slowly recovering from last year’s levels. The feedback we get from fabricators also reflects this.

Moreover, in January, some large-scale rolling mills reported to us improving export orders. However, the Red Sea disruptions are impacting freight rates and creating some delays. But fabricators say the impact on volumes is limited. This excludes can stock orders, which remain weak.

This article was first published by CRU. Learn more about CRU’s services at www.crugroup.com/analysis.

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