UK secondary aluminium ingot prices rose on Wednesday February 20, under pressure from the tight scrap market and European ingot prices, after the stronger euro saw export prices rise above domestic UK levels.
The euro was trading at about 1.145 to the sterling on Wednesday, after peaking above 1.17 to the sterling last week.
“The pound is getting weaker and weaker, and it’s now easy to sell ingot or scrap into Europe,” an ingot producer said.
LM24 pressure diecasting ingot rose to ?1,490-1,530 ($2,304-2,366) per tonne from ?1,460-1,490 previously, while LM6/LM25 gravity diecasting ingot reached ?1,700-1,760 per tonne from ?1,670-1,730.
Prices could have improved more, but the spot market in the UK is very quiet after strong contract buying by consumers late last year, according to market participants.
“There’s not much spot demand at the moment – the big car firms are all tied up in long-term contracts,” a second producer said. “But there is a lot of demand in Europe – we’re getting regular orders for significant volumes for March and April delivery.”
Metal Bulletin’s European DIN226 diecasting ingot price rose to €1,720-1,790 per tonne on Friday February 15, which translates to a sterling price of ?1,485-1,546.
“If we can’t make it work in the UK we’re just putting it in a container and getting it out to Europe,” a third producer said.
Producers are hoping that strong European prices will help push UK prices up further when spot demand materialises for second-quarter deliveries.
“We’re trying to push UK prices up as much as we can, and the euro will really help when we see enquiries for March and April,” the third producer said.
Scrap prices were broadly stable in the UK market after rising strongly throughout February so far, though some grades saw further increases from last week.
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