Global Aluminium Alloy Ingot Prices Drop as Demand Falters and Downstream Sector Faces Challenges

In the global market for Aluminium Alloy Ingot, prices have shown varied trends across major regions during the last week of July. In the USA, prices dropped due to increased inventories and decreased demand in key sectors such as automotive and construction. The automotive industry is facing significant challenges, with major manufacturers like Ford and Nissan experiencing declining profits and high inventories. Furthermore, In Germany Aluminium Alloy Ingot prices fell, reflecting negative market sentiment. The manufacturing sector also saw a decline in activity, which has contributed to lower demand for industrial metals. Meanwhile in China, prices decreased, driven by higher domestic production and slow demand. The automotive industry in China is highly competitive, with domestic brands offering more appealing options compared to foreign brands.

During the last week of July, the price of Aluminium Alloy Ingot in the USA experienced a 1.8% decrease compared to the previous week. This drop in prices is attributed to increased inventories and reduced demand in key sectors like automotive and construction. The U.S. automotive industry is encountering challenges such as low prices, high inventories, and logistical issues. Major car manufacturers such as Ford Motor, Stellantis, and Nissan have observed declining profits and stock values. Nissan particularly suffered from excessive inventory levels, resulting in substantial financial losses and a lowered profit due to aggressive price reductions in the U.S. market. Ford faced difficulties related to structural inefficiencies and obstacles in the electric vehicle segment. Moreover, the Manufacturing activity for July 2024 unexpectedly declined from the previous month, indicating a deterioration in conditions within the manufacturing sector. This decline was driven by reduced new orders and production levels, which further impacted the demand for Aluminium Alloy Ingot.

In the fourth week of July, Aluminium Alloy Ingot prices in Germany experienced a substantial 2.5% decline, reflecting a negative market sentiment. The automotive industry in Germany, a major consumer of Aluminium alloy, is encountering challenges, as reflected in the recent financial struggles of Mercedes-Benz. This trend reflects decreased demand for Aluminium Alloy Ingot from automakers. Additionally, the manufacturing sector is facing difficulties, as evidenced by the unexpected drop in the manufacturing activity for July, indicating a decline in production and output levels. This economic downturn is expected to decrease the demand for industrial metals such as Aluminium Alloy Ingot.

Aluminium Alloy Ingot prices in China dropped by 1.3% in the fourth week of July. The decline is mainly due to higher domestic production and slow demand. The automotive industry in China is experiencing tough competition and challenges, including a price war among manufacturers. Domestic automakers are offering affordable and advanced vehicles that are more appealing to consumers compared to foreign brands. BMW observed a decrease in deliveries in China in the first half of the year, while Honda Motor is closing one manufacturing plant in China and pausing production at another to focus on expanding their electric vehicle offerings. These factors, along with rising domestic production and shifting demands in the automotive industry, are likely to cause ongoing fluctuations in Aluminium Alloy Ingot prices in China.

As per ChemAnalyst, the anticipated demand from the U.S. automotive industry could push Aluminium Alloy Ingot prices higher. Additionally In Germany, price fluctuations in the raw material market may raise costs for Aluminium Alloy Ingots because of supply limitations. Moreover, increasing demand and favourable purchasing patterns in China may also lead to price increases. The anticipated rise in raw material costs is likely to add to the production expenses of Aluminium Alloy Ingots.