US Al: UBCs drop with LME against higher MWP

Used beverage can (UBC) scrap prices pare back the prior day's gains along with the broader exchange market, partially offset by a higher Midwest premium.

Argus' daily UBC scrap assessment declined to 81.5-83.25¢/lb on Wednesday from 82-83.5¢/lb on Tuesday. A sharp downturn in the spot aluminum contract was partially offset by a steep increase in the weekly Midwest premium assessment. Overall, buying spreads were noted multiple times in the 68-69pc range.

The cash London Metal Exchange (LME) settlement dropped to 101.51¢/lb in today's trading session from 103.21¢/lb yesterday, in line with the broader base metals complex and exacerbated by a stronger US dollar.

Argus' internal Midwest transaction price settled at 120.5¢/lb today as the P1020 differential increased to 18.5-19.5¢/lb today from 18-18.5¢/lb last Wednesday. Meanwhile, the 6061 and 6063 billet premiums were flat at 7-9¢/lb and 8-10¢/lb respectively.

Transportation time and costs started to climb higher as 2024 began as problems in the Red Sea continued and ocean freight through the Suez Canal started to drop off, which limited arbitrage opportunities for sellers of imported P1020.

Now, it remains uncertain what supply chain constraints will stem from the ship collision into Baltimore's Francis Scott Key bridge yesterday and the subsequent suspension of vessel traffic in the city's port. In 2023, more than a third of all US imports of unwrought aluminum containing greater than 99.8pc aluminum content, or 292,060 metric tonnes (t), came through the Port of Baltimore, according to US Commerce Data.