AMU Survey: Recyclers turn more cautious

Recycler expectations shifted further toward lower Midwest Premium and used beverage can (UBC) prices, while demand weakened and inventory drawdowns accelerated.

At the same time, obsolete scrap remained broadly available, export demand stabilized, and forward expectations remained divided between balanced, undersupplied and oversupplied conditions.

Midwest Premium expectations

The overall Midwest Premium distribution changed little in July from June.

About 28% expected a higher premium, up from 23%. Stable responses were nearly unchanged at 44%, while lower expectations fell to 28% from 32%.

Breaking the results down by company role revealed a much wider spread in expectations.

Distributors and traders split evenly between higher and lower expectations. Meanwhile, about 80% of manufacturers and assemblers expected the premium to remain stable and 20% expected it to increase.

Scrap recycler and processor expectations moved further toward the lower category. About 40% expected a lower premium, up from 29% in June. Another 40% expected stability, down from 57%. And 20% expected a higher premium.

The change is more pronounced when May is included. No recycler expected a lower Midwest Premium in May. That share increased to 29% in June and 40% in July. The subcategory didn’t move uniformly lower, but lower became tied for its largest response category.

UBC expectations

The overall UBC price distribution was unchanged from June. About 25% expected higher prices, 44% expected stable pricing, and 31% expected lower pricing.

Recycler responses, however, diverged from the broader response pool. About 40% expected lower UBC prices, up from 14% in June. Stable expectations fell to 30% from 57%, while the share expecting higher prices remained nearly unchanged at 30%.

July’s survey results redistributed recycler responses out of stability, with most of the movement entering the lower category.

The identical 40% lower readings for recycler Midwest Premium and UBC expectations make an outright price interpretation more compelling.

A lower Midwest Premium can reduce the Midwest transaction price, which can lower the outright UBC price even when the percentage-based buying spread remains unchanged.

Obsolete scrap availability

About 82% of all respondents said enough obsolete scrap was available to meet demand, up modestly from 79% in June but below May’s 93% result.

Among recyclers, those reporting sufficient availability increased to 80% from 71%. The remaining 20% reported insufficient supply.

Manufacturers and assemblers had offset the smaller recycler share reporting adequate scrap availability in June, but that relationship reversed in July. Four out of five manufacturers and assemblers reported sufficient supply after every respondent did so in June.

The obsolete scrap responses align more closely with the demand and inventory responses by recyclers than with stronger scrap generation.

Recycler demand shifted toward decline from the previous month. In response to the question regarding current demand for products and services, 40% of recyclers noted declining demand, up from around 14% in June. That compared with around 19% of non-recycler respondents noting declining demand in the July survey. The remaining recycler responses were 50% reporting stable demand, while 10% reporting improving demand.

The month-to-month shift in inventory responses was even more pronounced. A total of 70% of recyclers reported drawing down inventory, up from only 33% in June and 17% in May. The remaining 30% reported keeping inventories steady.

The demand, inventory and obsolete scrap responses indicate material availability remained sufficient relative to current buying requirements rather than stronger scrap generation.

Export demand

No respondents reported improving export demand in July, down from 11% in June and 50% in May. Stable responses increased to 69%, while declining responses rose slightly to 31%.

Recycler export responses became less negative than in June but did not return to growth. About 78% reported stable export demand, while the remaining 22% reported declining demand.

In June, 50% reported stable demand, 33% reported a decline, and 17% reported improvement. In May, 60% of recyclers reported improving export demand, and the remaining 40% reported stable conditions.

In other words, recycler export demand seemingly stabilized after June’s weaker reading, although no respondent reported improving export demand.

The export demand question is heavily weighted toward the scrap market. From January through May, aluminum scrap accounted for 68% of total US aluminum exports across the full range of aluminum products covered by the HTS chapter, up from 58% during the same period in 2025.

The remaining export volume was spread across unwrought aluminum, extruded products, rolled products, wire, foil, tubes/pipes and their fittings, and other aluminum products, leaving scrap as the dominant export category by a wide margin.

The responses also showed a strong split between end markets. Transportation- and packaging-focused respondents reported stable export demand. Meanwhile, building and construction respondents unanimously reported declining conditions. Consumer durables-focused respondents also leaned heavily toward decline.

Recycler forward expectations

Recycler views of the three-month market balance became more dispersed.

About 40% expected balanced conditions, down from 57%, while the undersupplied share rose to 30% from 14%. Oversupplied expectations were nearly unchanged at 30%.

The split in forward expectations makes it difficult to describe the scrap market as oversupplied.

Current demand weakened and inventory drawdowns accounted for a larger share of recycler responses, yet nearly one-third of recyclers still expected an undersupplied market over the next three months.

Qualitative recycler lead time responses also moved away from June’s unanimous stability.

About 22% reported extending lead times, while the remaining 78% reported stable lead times.

June appears more like an outlier when viewed alongside the surrounding survey results. In May, recycler responses were divided evenly between extending and stable lead times at 43% each, while the remaining 14% reported shrinking lead times.

The July recycler responses infer more toward moderating demand than expanding scrap availability. Price expectations shifted lower and inventories moved out of steady holdings, but recyclers stopped short of broadly anticipating excess scrap supply later this year.