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Non-ferrous metals - 23 November 2012

Aluminium ingot

According to figures from the European Automobile Manufacturers’ Association (ACEA), new passenger car registrations in Europe declined for the 12th consecutive month. Germany saw demand fall by 1.8% while Spain (-11.0%), France (-13.8%) and Italy (-20.5%) contracted more severely.

By contrast, UK new passenger car registrations continue to show year-on-year growth with the figure up 4.3% to 1,620,609 against 1,553,094 in 2011.

The consequent demand for material has kept UK die casters for the best part of 2012 “busy fools”, according to one merchant. Another trader said these increases “were fantastic news for the UK and the industry as a whole”.

A few suppliers warned they are also seeing a fair amount of undercutting in the marketplace which could eventually drive some of the smaller die casting firms under. Profit margins have been described as “tight, with not too much loss” for of the year, leaving very little room for producers to scrape a decent return.

With sterling gaining momentum against the euro, merchants have noted more enquiries over recent weeks from continental smelters looking to book in orders with UK suppliers. 

UK aluminium scrap prices have remained reasonably steady but the same cannot be said for aluminium ingots. With the exception of grades LM2 and LM35, the majority of other grades contracted further this week.

LM4 falls back by £45 tonne to £1,580, LM6 is now £1,680 per tonne, while LM24/25 both drop an average of £25 per tonne to £1,400 and £1,660 respectively.

Stainless steel

The fall in car production in Europe is also affecting the stainless steel industry. End users are doubtful about any new orders until there is significant growth in the building and construction industries.

Low stocks in Europe mirror the softer market conditions; market anecdotes anticpate that global nickel prices may pick up in early 2013 as consumers tentatively start to build up stocks.

UK traders are still reporting no real signs of a recovery and demand from the steelworks remains very low for the year.

18/8 stainless steel solids improved marginally, up £20 per tonne, while most scrap nickel and alloys prices were unchanged on the week.

At the time of writing the LME nickel price was up to $16,330 (£10,267) per tonne, though merchants are wary that the nickel prices have yet to bottom out; overall primary and scrap nickel prices are down by 12-13% on the year to date.

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