China has approved 121,000 tonnes of aluminium scrap imports in its 12 batch of quota this year, according to the China Solid Waste and Chemicals Management report. This brings China’s total approved amount of aluminium scrap import quotas to 818,000 tonnes so far this year.
SMM estimates China’s aluminium scrap import quotas for the fourth quarter of the year to come in at 130,000 tonnes to 150,000 tonnes, much lower from Q3.
In the 11th batch of aluminium scrap import quotas, which was the 3 round of approval for Q3 2020, China permitted 2,610 tonnes.
A secondary aluminium producer in Jiangsu province that uses imported aluminium scrap obtained 16,620 tonnes of import quotas in the 12th batch, ranking the second. This brings its monthly average import quotas to around 5,540 tonnes, which is barely enough to produce 5,000 tonnes of ADC12 secondary aluminium per month.
Based on the correlation between aluminium scrap imports and ADC12 secondary aluminium prices over the past two years, SMM believes the latter to exceed those of A00 aluminium ingots in the short term. Imports of aluminium alloy ingots are estimated to become popular again to fill the supply deficit of aluminium scrap.
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