Aluminum Importers: Stock Up!

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MetalMiner welcomes guest contributor Chelsea Craven of Zepol Corporation, a Minneapolis-based trade intelligence company. 

From the soda can you hold in your hand, to the building in which you stand in, materials made from aluminum are all around us. The aluminum industry, and the metal industry in general, play an important role in determining the strength of the manufacturing and construction sectors in an economy. Typically, when demand rises, price follows.

In recent months, however, we’ve seen a peculiar trend in the aluminum trade for the United States. Overall, the price per kilogram for aluminum imports is low compared to last year. In fact, the average price for 2012 is nearly 9 percent lower than the previous year (for ocean imports of aluminum).

In addition, the volume of aluminum imports, in terms of weight, has taken a noteworthy upward turn, increasing over 30 percent in the year to date.

That’s right, it appears that importers of aluminum are stocking up while the price per kilogram is low.

Source: Zepol

Of all aluminum products imported into the United States, unwrought (unfinished) aluminum is by far the most popular import via ocean, in terms of value and weight. Ocean imports in May 2012 reached more than $340 million, mostly originating in Russia, the United Arab Emirates, and Canada. Most recently, unwrought aluminum from Qatar has been growing in popularity.

Overall, unwrought aluminum imports are up 24 percent from last year, while the price is down by $0.34 per kilogram, or 13 percent. The graph below illustrates this trend and breaks down unwrought aluminum into alloys and non alloys.

On average, the United States imports $1.3 billion worth of aluminum and aluminum products each month (including truck and rail imports from Canada and Mexico). On the export side, on average, the United States exports about $1 billion worth of aluminum each month, mostly consisting of aluminum waste and scrap destined for Mexico, Canada, and China.

The aluminum industry is unmistakably big business for many in the United States, and recently, the business has been booming.

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