Market
January 4, 2024
US scrap market remained sluggish in December
Written by Marziyeh Horeh, Analyst, Aluminium
Approaching the year-end, the US scrap market experienced a sluggish trend, primarily attributed to a widespread anticipation for 2024 as people engaged in significant stockpiling. The cautious sentiment stems from an excess of purchases in 2023, leading individuals to be extremely mindful of their inventories. On a macroeconomic level with the potential of affecting the scrap market dynamics, building permits witnessed a 2.5% m/m decline in November. However, there was an increase of 0.7% y/y in single-family unit housing permits, contributing to an overall 4.1% y/y growth in building permits. As per the National Association of Realtors (NAR), the median price of existing home sales rose by 4.0% from November 2022 to $387,600. The fall in existing home sales is attributed to the high mortgage rates and subsequently the buyers’ hesitation.
According to the Aluminum Association, can stock (class) scrap receipts amounted to 64.1 Mlb during October 2023, indicating a 0.8% y/y decrease. In a month-to-month comparison, total receipts increased by 7.1% in October compared to the previous month’s total of 59.8 Mlb. The year-to-date receipts for 2023 were 614.5 Mlb, reflecting a 15.6% y/y decline.
The US exports of scrap (HS code 7602), amounted to 168 thousand tonnes in October, showing a 5.6% m/m decrease over the 178,000 t in September. The year-to-date exports of scrap amounted to 1.718 Mt, increasing 10.8% over the 1.55 Mt a year ago. Key export destinations for US scrap include India, Canada, Mexico, and various South-east Asian countries. However, there are reports suggesting that exports to South-Asian countries are ultimately rerouted to China.
Shifting to scrap prices, the Used Beverage Can (UBC) scrap price experienced an upswing, rising from $0.69/lb at the beginning of December to $0.77/lb by the end of the month. Painted siding prices remained within the $0.74 – 0.79/lb range. The price range for 6063 New Bare Extrusion fluctuated between $0.96 – 1.05/lb, while 6063 New Painted Extrusion varied between $0.88/lb and $0.97/lb throughout December. The Poly 5052 price saw an increase from $0.73/lb to $0.89/lb. Similarly, 5052 Bare prices witnessed a rise within the $0.97 – $1.05/lb range throughout December 2023. Additionally, 3003 Bare prices fluctuated between $0.96/lb and $1.02/lb during the same period.
