Bullish Momentum for Aluminium Alloy Ingot Prices Persists for US and Germany in Early June 2024

With the week ending on June 7^th in USA, a price hike on Aluminium Alloy Ingot was observed due to persistent supply constraints amid high demand. The scarcity of bauxite, exacerbated by reduced exports from Guinea during the rainy season, along with elevated freight costs and Rio Tinto's alumina export issues from Australia, contributed to this increase. Additionally, in Germany, the market saw a price increase in early May, driven by limited raw material availability and extended supplier delivery times. Energy costs and shipping expenses also rose, particularly for imports from China and East Asia. However, imports from Malaysia increased, reflecting moderate demand in the manufacturing and automotive sectors. Conversely, the Chinese market experienced price decrease. This was attributed to increased supply as mills replenished stocks ahead of the Dragon Boat Festival, and a stable production index despite minor fluctuations. Lower demand in the real estate sector and weak new orders both domestically and internationally led to reduced pressure on the supply chain and a drop in shipping costs.

As of June 7^th, the USA Aluminium Alloy Ingot market experienced a 2% price hike due to ongoing supply constraints amidst high demand. The scarcity of raw materials, specifically bauxite, contributed to the limited supply. Additionally, reduced Guinean exports during the rainy season worsened bauxite shortages. Moreover, elevated freight costs and Rio Tinto's force majeure declaration on alumina exports from Australian refineries further raised prices in the spot market. Moreover, manufacturers faced challenges due to a rise in input cost inflation, leading to higher selling prices. In the automotive sector, both Light Vehicle Seasonally Adjusted Annualized Sales (SAAR) and new vehicle sales in the US saw significant growth in May.

The German market for Aluminium Alloy Ingot experienced a 3% increase in the week ending on May 7^th, driven by supply constraints mainly attributed to limited availability of raw materials like bauxite. The production decline rate reduced significantly in the second quarter, marking the smallest decrease since May 2023. In April, supplier delivery times extended, and escalating energy costs heightened pressure, with the Heat price index displaying a year-on-year rise. Shipping expenses also surged, particularly for shipments from China and East Asia to Northern Europe in the initial week of June. Despite the obstacles, demand for Aluminium Alloy Ingot in Germany displayed moderate activity, backed by positive trends in the manufacturing and automotive sectors.

During the week ending on June 7^th, the prices of Aluminium Alloy Ingot decreased by 0.3% due to changes in supply and demand in the market. The supply of Aluminium Alloy Ingot increased significantly as mills replenished their stocks before the Dragon Boat Festival. Despite a slight decrease in the production index, manufacturing growth was stable. Demand for Aluminium Alloy Ingot remained low, mainly due to challenges in the real estate sector. While the construction industry saw some improvement, overall domestic demand was weak. Weak new orders and export orders internationally indicated a lack of demand for Aluminium Alloy Ingot in China.

According to ChemAnalyst, a robust surge in demand from automobile sector for Aluminium Alloy Ingot in the US market may result in increased prices. Additionally, in Germany, variations in raw material market rates could raise the costs of Aluminium Alloy Ingot due to supply constraints. Furthermore, positive buying patterns and escalating demand in China might drive up the prices of Aluminium Alloy Ingot. The rising prices of raw materials can also add to the increased production expenses for Aluminium Alloy Ingot.