ANALYSIS: US imports of P1020 aluminum manage to increase amid difficult global logistics
P1020 Canada’s imports amount to 121,462 mt
Freight remains high, logistics difficult
Imports of primary unalloyed aluminum to the United States increased 9.8% month-on-month in August to reach 158,979 mt, while shipments from Canada increased 5.9% to 121,462 mt , according to US Census Bureau data released on October 5.
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Total imports of P1020 in January-August fell 30% on the year to 1,060,627 mt.
Higher purity shipments from origins such as the United Arab Emirates, Russia and India fell 27.9% in August, with logistics issues, rising costs and a tightening regional due to the persistence of premiums. Replacement costs in the United States could be around 40 cents / pound, according to market sources. UAE high purity sows were still down around 41% year-on-year until August.
Market sources cited high freight rates and long delivery times that are expected to remain.
Market sources also said concerns about trucking remained as some warehouses like Owensboro, Kentucky and the South remained narrower than others, like Toledo and Ohio, where the costs to move equipment from Midwest terminals more. inland were up more than 200% per year. year. Discounts of up to around 7 cents / lb have been observed, due to long delivery times of up to 12 weeks for inland rail transport, while the area is typically reduced by 2 cents / pound at 3 cents / pound due to freight to the Midwest.
The same data showed that total imports of primary aluminum under HTS code 7601 amounted to 320,565 mt in August, up 7% on the month and 18.77% on the year.
Shipments of P1020 or higher purity from Canada were down 27.85% year-on-year in January-August. Rail shipments in August were down 18.87% year-on-year to 59,155 mt, while shipments by water increased 26.12% to 60,229 mt.
British Columbia’s P1020 exports to the United States were 1,094 mt in August, down about 81% on the month, as Unifor Union and Rio Tinto reached a tentative agreement on the 25th. September for the BC Works foundry.
Canadian imports of P1020 were just under 76.4% of US imports of unalloyed products in August and 72.47% of the previous 10-year average for the same month. Almost all of this material is produced by hydroelectric smelters and is considered low carbon and is around or below the 4 mtCO2 / t level in scopes 1 and 2, as Canada has been able to sell to United States with paid premium. levels supporting the all-in of their aluminum. The prices of S&P Global Platts nature-based carbon credits have risen nearly 70% through October 6 since their launch on June 14.
Bullion imports from Australia climbed nearly 267% month-on-month to 17,091 mt in August. Imports from New Zealand fell to zero during the month, with imports accounting for part of the flow of high purity ingots, P0404, to the west coast of the United States.
The Platts US Midwest premium held just below the Oct. 5 high at 34.85 cents / pound, due to tight supply in most of the United States, high freight costs and demand solid, which are expected to continue at least until the first quarter of 2022.
High demand for VTBI
Imports of value-added products, such as billets, foundry alloys and slabs, increased 38.06% year-on-year in August as demand remained firm. Shipments from Canada, United Arab Emirates, Russia and Bahrain completed the top four in August totaling 161,586 mt, up 4.4% month-on-month.
Imports from Canada of billets, slabs and foundry alloys to the United States totaled 99,192 mt, up 30.04% year on year as aluminum alloy from Canada could enter the United States. United duty-free and would not fall below USTR import levels set in 2020 Since the start of the year, slab imports from Canada have increased by just over 81% as the tight market for premium scrap has forced some factories to move closer to the spot market for more feedstock and slabs in order to retain the chemical mix of products, and as factories look to use more scrap in the push towards decarbonization.
Imports of industrial aluminum scrap increased 75% year-over-year through August, while imports of used beverage cans rose 45%. Exports also picked up in August, up 20% from 2020.
VAP imports from Russia continued to flow to the United States, up about 86% year-on-year through August.
Platts US 6063 spot billet supplement hit an all-time high of 28 cents / pound on August 12, but edged down to 25 cents / pound on September 2 and remained at that level, as 2022 contract negotiations begin.