Though imports of scrap aluminium into the People’s Republic of China rose on the year in August, levels were nearly identical to the month prior in August, the second full month of scrap aluminum restrictions under the new permitting regime implemented by Beijing this summer.
Per domestic industry reporting, the Middle Kingdom imported 141 thousand metric tons of scrap aluminium in August, on par with total imports in July but over 7 percent above the total for August of last year.
Experts say the favorable price of overseas aluminium scrap compared to that of domestic coupled with the volume of third quarter import quotas of Category Six aluminium scrap, which is higher-grade aluminium, matching realized imports over the same period to keep imports high in August.
September’s import totals may not be quite as strong, as concerns are beginning to mount over a possible scale-back in quotas for aluminium imports.
Meanwhile, unwrought aluminium alloy scrap imports rose to a several-month high in August, totaling 16,008 metric tons. Per customs data, that total is 27.9 percent up on the month and 143.3 percent higher on the year. Better prices of overseas secondary aluminium ADC12 compared to domestic supplies have helped buoy imports of unwrought aluminium alloy for the past three months.
Going forward, experts project tighter feedstock supplies due to expected lower quota totals in the fourth quarter to exert upward pressure on prices of domestic secondary aluminium. Such a situation is likely to lead importers to purchase more unwrought aluminium alloy this month and next.
Beijing instituted an import quota system on July 1 in order to address environmental concerns. Under the regime, only buyers with permits may import to specified ports an assigned quota of aluminium scrap from overseas.