AlCircle: Latest secondary aluminium news update

Aluminum Association applauds trump administration action to secure critical materials supply chains

Mon, 03 Aug 2026 08:34:00 +0530

The Aluminum Association today welcomed President Trump's memorandum calling for strengthened domestic supplies of recoverable critical minerals and materials. The memo directs the Commerce Secretary to take “all appropriate action under section 101 of the [Defense Production] Act” to “secure the supply of recoverable Critical Minerals and Materials.” Aluminium is one of only a handful of materials included on every government critical minerals list.

The Aluminum Association has called for targeted scrap export controls to keep more of this vital material in the United States. Aluminium scrap exports are growing, and much of this metal is ending up with strategic rivals including China, either directly or through third-party countries. The association encourages the Commerce Department to include aluminium scrap, specifically used beverage containers, in any implementation language or other action following this memorandum.

“President Trump’s call to action recognises an increasingly important reality: materials already circulating in our economy are strategic national assets," said Charles Johnson, president & CEO of the Aluminum Association. "Just as America must produce more critical materials, we must also ensure valuable recoverable materials are available to support US manufacturers, the defence industrial base and American workers."

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The presidential determination recognises that recoverable materials embedded in products and manufacturing scrap are strategic industrial resources essential to the nation's defence. The memo reinforces a principle that the association has long advocated for aluminium – the United States should pursue an all-of-the-above strategy to strengthen domestic supply by expanding both primary aluminium production, recycling and recovery. America will need both primary and secondary aluminium to meet growing demand from defence, transportation, energy infrastructure, packaging and other critical industries.

“Building a stronger domestic aluminium industry means investing in new primary production, expanding recycling capacity and ensuring strategically important aluminium scrap remains available to support American manufacturers," said Johnson.

Today, millions of tons of aluminium scrap are shipped overseas, a significant percentage of overall US aluminium supply. And these exports are growing as China seeks to dominate global aluminium recycling, helping fuel overseas production that competes directly with American manufacturers. As new aluminium industry investments come online in the coming years, demand for this material is only expected to grow.

"Aluminium scrap is not waste —it is a critical manufacturing input," Johnson said. "When clean, high-value aluminium scrap leaves the United States, we lose an opportunity to strengthen domestic supply chains, support American recycling investments and manufacture more aluminium products here at home."

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In addition to common sense recycling policies and infrastructure investment, the Aluminum Association is calling for targeted scrap export controls, including an immediate ban on the export of used beverage containers. Such action would reduce dependence on foreign sources of aluminium and reinforce the resilient manufacturing base needed to support both economic growth and national security.

“As the administration works to strengthen America's industrial supply chains, aluminium scrap must be part of that conversation," Johnson said. "An all-of-the-above approach to aluminium supply – one that supports domestic primary production while maximising scrap recovery and recycling – will help ensure the United States has the secure, resilient aluminium supply needed to compete and win, now and in the future."

Note: This article has been issued by Aluminum Association and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.

Alupro’s impact report demonstrates critical importance of supply chain collaboration

Wed, 29 Jul 2026 10:55:00 +0530

Alupro has launched its impact report for 2025. The Chain Reaction: Turning change into impact presents the latest results from its consumer engagement initiatives and explains how behavioural change is helping to turn everyday actions into lasting legacy.

A key theme of this year’s report was the role of collaboration in driving progress towards achieving a truly circular packaging economy. Indeed, as the packaging sector navigates a complex period of regulatory change, collaboration between government and industry is becoming increasingly critical to bringing together the value chain and driving measurable national change.

According to data presented within the report, the UK collected 150,684 tonnes of aluminium packaging for recycling in 2025, saving 1.3 million tonnes of carbon by using recycled material to make new products. Alupro’s consumer engagement programmes proved instrumental in achieving this volume, by improving consumer education, encouraging best practice and inspiring positive behavioural change.

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Its Every Can Counts initiative, for example, was responsible for encouraging 12.5 million consumers to recycle their beverage cans, with the team’s attendance at 15 major festivals helping to spread best practice on-the-go recycling messaging. Teams wearing recycling backpacks at each of these events personally collected more than 70,000 cans, which would otherwise have been landfilled.

A favourite among local authorities, the past 12 months saw Alupro’s MetalMatters campaign rolled out across Somerset and Calderdale, directly communicating with more than 350,000 households with the ambition of delivering positive behavioural change and increasing kerbside collection volumes.

Elsewhere, Alupro’s education campaigns reached 43,000 students (an uplift of 10 per cent compared to 2025) and drove 180,000 visitors to its website, while its ‘Foil in Love with Recycling’ initiative helped to communicate positive sustainability messages to over 112,000 households across Westmorland and Furness.

Delivering upon its role as the voice of the aluminium packaging industry, the Alupro team also attended three parliamentary events, delivered 11 speaking slots, engaged with 1,100 policymakers and helped to achieve GBP 8.1 million (USD 10.77 million) in savings through a significant reduction in EPR cost for aluminium packaging. In total, Alupro inspired change through partnerships with 69 different local authorities in 2025.

Finally, its UK Aerosol Recycling Initiative (UKARI) saw four councils collaborate through pilot campaigns and sampling activities, while the wider programme delivered an impressive 24 per cent national increase in aerosol capture rates at the kerbside.

In comment, Tom Giddings, executive director of Alupro, commented, “We’re delighted to launch our latest impact report and provide further insight into the important work that we deliver. It’s important that we target our focus towards the biggest challenges and opportunities that our members are facing. This report is a great way to demonstrate and evaluate the progress we’re making towards achieving ambitious national goals.

“Alongside successfully rolling out behavioural change initiatives across all four corners of the UK, our public affairs work in 2025 saw the aluminium packaging supply chain benefit from more than GBP 8 million (USD 10.64 million) in cost savings. This demonstrates the tangible value that we deliver to our members and the positive progress we’re making towards enabling a truly circular packaging economy.”

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Note: This article has been issued by Alupro and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.

Middle East export ban disrupts aluminium scrap trade, pushing India toward new markets

Wed, 29 Jul 2026 07:20:00 +0530

India's aluminium scrap importers are looking beyond the Middle East for supplies after several Gulf countries imposed a ban on aluminium scrap exports from June 10, disrupting shipments from one of the country's key sourcing regions.

The restrictions have prompted importers to explore alternative suppliers in Brazil, the Dominican Republic, Singapore, Hong Kong and Malaysia as they seek to secure raw material for India's secondary aluminium industry.

Aluminium scrap is the primary feedstock for secondary aluminium production, which supplies metal to the automotive, electrical, construction, packaging, consumer durables and engineering sectors. India depends heavily on overseas supplies, with around 80 per cent of its aluminium scrap requirement met through imports.

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During 2025-26, India imported 2.02 million tonnes of aluminium scrap worth INR 40,203 crore (USD 4.2 billion). The Middle East accounted for about 400,000 tonnes, or nearly 20 per cent of total imports, making it India's third-largest sourcing region after Europe and North America. The export restriction, which covers selected aluminium, copper and iron scrap categories, is expected to remain in force until October 8.

Europe remained India's largest supplier of aluminium scrap during the year, exporting around 0.54 million tonnes worth INR 10,206 crore (USD 1.06 billion). North America followed with 0.48 million tonnes valued at INR 8,683 crore (USD 907 million). Supplies from ASEAN countries stood at 0.14 million tonnes worth INR 3,231 crore (USD 337 million), while East Asia and Oceania contributed another 0.11 million tonnes valued at INR 2,480 crore (USD 259 million).

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Industry representatives said replacing Gulf supplies will not be easy. Sanjay Mehta, President of the Material Recycling Association of India (MRAI), said no single country can compensate for the shortfall. He added, "There is much chaos for various grades of aluminium scrap or other recyclable scrap from other countries and price may move up as we need to continue our production target of aluminium in India."

The industry is also facing higher procurement costs as longer shipping routes coincide with India's 2.5 per cent import duty on aluminium scrap. Mehta noted that competing countries do not impose similar duties, putting Indian recyclers at a cost disadvantage. The Ministry of Mines has already recommended removing the duty and forwarded the proposal to the Finance Ministry.

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Industry participants said the combination of rising global aluminium scrap prices, longer shipping routes and India's 2.5 per cent import duty is increasing the landed cost of imported scrap. They warned that the higher input costs could weaken the competitiveness of India's secondary aluminium producers, particularly against manufacturers in countries that do not impose import duties on scrap and have easier access to raw materials.

Bharat Garg, President of the Federation of All India Aluminium Utensil Manufacturers, said the UAE has long been an important supplier of aluminium scrap to India. He said the export ban has reduced material availability, increased international scrap prices, raised freight costs and forced recyclers to diversify sourcing until exports from the Gulf resume.

Mercedes-Benz adopts Hydro CIRCAL with 75% recycled aluminium for next-gen EVs

Mon, 27 Jul 2026 13:45:00 +0530

Mercedes-Benz and Norsk Hydro have solidified their long-term partnership to accelerate the use of recycled aluminium across Europe. The initiative reinforces the automotive industry’s decarbonisation goals while reinforcing regional supply chains, thereby taking the EU a step closer to the Net Zero goals.

As part of the expanded collaboration, Mercedes-Benz will become the first European automaker to use Hydro CIRCAL in serial production for its next generation of large electric vehicles (EV). The recycled aluminium contains at least 75 per cent post-consumer scrap, a significant increase from the previous minimum of 25 per cent. The material is produced from end-of-life vehicles, buildings and infrastructure through advanced recycling processes.

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Eivind Kallevik, President and CEO of Hydro, noted, the automotive industry’s requirement for “materials that can cut emissions without compromising quality, safety or performance.”

So, “By combining Hydro CIRCAL recycled aluminium with Hydro REDUXA low-carbon primary aluminium,” the company aims to “accelerate the transition to lower-carbon vehicles while building more resilient value chains.”

Focus extends to low-carbon primary aluminium

Alongside expanding recycled aluminium use, the companies will continue working to reduce emissions from primary aluminium production by increasing supplies of Hydro REDUXA and jointly lowering its carbon footprint over time.

Hydro said combining recycled and low-carbon primary aluminium will help meet rising demand while reducing reliance on virgin raw materials. Localised recycling is also expected to shorten supply chains and improve material security.

“The next generation of automotive supply chains will be defined by higher levels of circularity, a lower-carbon footprint and a deeper level of localisation,” stated Yanni von Roy-Jiang, Head of Procurement & Supplier Management at Mercedes-Benz AG.

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Building on an existing decarbonisation roadmap

The partnership builds on a 2022 letter of intent outlining a joint low-carbon technology roadmap through 2030. In 2024, both companies expanded their collaboration to cover the entire aluminium value chain, from raw material sourcing to finished products, including the Corridor Program in Brazil, which combines supply chain decarbonisation with social responsibility initiatives.

Mercedes-Benz already sources Hydro REDUXA, produced using renewable energy, with a carbon footprint more than 70 per cent below the global average.

As Mercedes-Benz expands its electric vehicle lineup, from the EQS and EQE to the G-Class EV and future Mercedes-Benz E-Class electrified models, its agreement with Hydro further reinforces both companies’ commitment to circularity, regional sourcing, and lower-carbon mobility.

Explore the position of aluminium at the intersection of sustainability and strategy in Sustainability & Recycling: Aluminium's Dual Commitment

ALFED calls for greater domestic aluminium recycling to improve the UK's industrial competitiveness

Mon, 27 Jul 2026 07:41:00 +0530

Aluminium is often described as one of the most recyclable industrial materials, and the UK already has much of the infrastructure needed to support a circular aluminium economy. Collection systems are well established, recycling rates are strong, and remelting capacity exists across the supply chain. According to Nadine Bloxsome, CEO of the Aluminium Federation (ALFED), the challenge is no longer whether aluminium can be recycled, but whether the UK is keeping enough of the value created from that recycled material.

One of the biggest issues is the way aluminium is still viewed. The term "scrap" often suggests waste, yet secondary aluminium has become one of the UK's most important raw materials, particularly as domestic primary aluminium production remains limited. ALFED estimates that recycling aluminium requires up to 95 per cent less energy than producing primary metal, making it an important contributor to industrial competitiveness as well as the country's net-zero ambitions.

Despite this, the UK continues to rely heavily on imported primary aluminium. Around 68,000 tonnes were imported from the UAE, Bahrain, Oman, Qatar and Saudi Arabia during 2025. Recent geopolitical tensions and disruptions affecting energy-intensive smelting operations in the region have highlighted the risks that come with depending on overseas supply. Making greater use of aluminium already circulating within the UK would not only reduce that exposure but also strengthen domestic manufacturing.

The UK generates large volumes of aluminium scrap every year, yet much of the material leaves the country instead of being processed locally. Trade figures illustrate the trend. Aluminium scrap exports to the United States increased from around 2,000 tonnes in 2024 to more than 23,000 tonnes in 2025, while total exports under HS Code 7602 rose from about 612,000 tonnes to more than 623,000 tonnes. During the same year, the UK also imported around 90,000 tonnes of aluminium scrap, showing that the issue is not a shortage of material but where that material is processed and where its value is ultimately created.

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According to Bloxsome, the main weakness lies in the middle of the supply chain. The UK has strong collection systems and established demand, but investment in advanced sorting, alloy-specific processing and recycling-to-product infrastructure has not kept pace. Without enough domestic processing capacity, exporting aluminium scrap often becomes the most commercially attractive option, even though retaining and processing it within the UK could generate greater long-term value.

Aluminium also presents different challenges from many other recycled materials. Its performance depends heavily on alloy composition, requiring specialised processing and, in many cases, closed-loop recycling systems. Because of this, ALFED believes aluminium should be addressed through policies designed specifically for its value chain rather than through broader recycling measures that apply to all metals.

The UK aluminium sector is also closely linked with Europe through ownership, processing networks and long-established supply chains. At the same time, the European Union is placing greater emphasis on circularity and retaining more recyclable materials within its own market. If these policies become more restrictive and the UK does not respond, there is a risk that the country could increasingly become a supplier of aluminium scrap rather than a producer of higher-value recycled products.

ALFED does not support export restrictions. Aluminium is traded globally, and international trade will continue to play an important role in the industry. Instead, the federation argues that the focus should be on improving the conditions that encourage more aluminium to be processed within the UK.

Through the UK Aluminium Alliance, the federation is working with industry and government to identify capability gaps, assess processing capacity and build the evidence needed to support future investment.

The UK already has the raw material, technical expertise and industrial demand needed to build a stronger recycling economy. The remaining challenge is creating the market conditions that allow more of that aluminium to be processed and used at home. Doing so would reduce dependence on imports, strengthen supply-chain resilience and allow more of the economic value generated from recycled aluminium to remain within the UK.

Explore our e-magazine “Sustainability & Recycling: Aluminium's Dual Commitment” for the latest industry insights and trends.

Recognising aluminium scrap as a strategic secondary raw material is part of that process. Equally important is ensuring that recycled aluminium is retained, processed and used where it can generate the greatest economic value.

With the right investment and policy support, aluminium can play a much larger role in the UK's industrial future, contributing not only to recycling targets but also to a more resilient and competitive manufacturing sector.

Cost support battles weak demand; short-term ADC12 prices move sideways

Sun, 26 Jul 2026 00:00:00 +0530

Aluminium scrap: This week, the aluminium scrap market stayed high while moving sideways, with overall limited price fluctuations. On July 23, SMM A00 spot aluminium prices closed at RMB 23,260 per tonne, up slightly by RMB 90 per tonne W-o-W.

Regarding the price spread between primary aluminium and scrap, on July 23, the price difference between A00 aluminium and mixed aluminium extrusion scrap free of paint in Foshan was approximately RMB 2,100 per tonne, and the price difference between A00 aluminium and shredded aluminium tense scrap in Foshan was approximately RMB 780 per tonne, both remaining at historical lows.

In terms of imports, according to customs data, China's aluminium scrap imports in June 2026 totalled approximately 132,800 tonnes, down M-o-M from 152,000 tonnes in May, marking the third consecutive monthly decline. From the cumulative data for 2026, total aluminium scrap imports from January to June were approximately 981,800 tonnes.

Orders from Southeast Asia in the Guangdong region increased, and the import window improved slightly, but new transactions still primarily involved low-priced resources, with overall spot market trading activity remaining limited. Affected by the UAE's aluminium scrap export ban and the EU's tariff hike policy, the shrinkage effect on high-quality aluminium scrap import sources will further manifest in the future.

Next week, the aluminium scrap market is expected to continue a narrow sideways pattern, suppressed by demand and supported by costs. Against the backdrop of deepening off-season, downstream end-user orders are unlikely to see substantial improvement, and scrap utilisation enterprises continue to purchase as needed, with the purchasing atmosphere unlikely to improve significantly.

The mainstream operating range for shredded aluminium tense scrap (priced based on aluminium content) is expected to be at RMB 19,800-20,400 per tonne. Currently, the price spread between primary aluminium and scrap has narrowed to a historical low, significantly weakening the economic advantage of aluminium scrap relative to primary aluminium.

If primary aluminium prices continue to decline subsequently, while aluminium scrap remains resilient supported by tight supply, the price spread between primary aluminium and scrap will face the risk of further narrowing, and the substitution effect of primary aluminium for scrap will accelerate. Close attention should be paid to changes in primary aluminium prices and the price spread between primary aluminium and scrap, as well as the crowding-out effect of primary aluminium substitution on aluminium scrap demand.

Secondary aluminium alloy: This week, ADC12 prices continued to fluctuate narrowly. As of today, the SMM ADC12 quotation was adjusted down by RMB 100 per tonne from last Thursday to RMB 24,000 per tonne. During the week, cost support from aluminium scrap remained, and enterprises showed limited willingness to cut prices proactively; however, constrained by weak off-season demand, upward price momentum was also lacking, and the market overall exhibited a bargaining pattern of "holding prices firm for shipments and closing deals based on orders."

On the cost side, primary aluminium prices edged up this week, driving aluminium scrap prices to follow. Meanwhile, there is no sign of easing in the tax invoice policy, and the supply of compliant aluminium scrap remains tight, with short-term cost support for ADC12 prices staying solid. On the demand side, the traditional consumption off-season has deepened further, downstream order releases have been limited, and market transaction activity has been sluggish.

The demand side's boost to price increases is clearly insufficient, and short-term demand improvement remains limited. The market still needs to wait for the growth support from the recovery of peak season orders.

On the supply side, the operating rate of industry leaders in the secondary aluminium sector fell by 0.4 percentage points W-o-W to 50.8 per cent this week, at a lower level for the same period in recent years. Insufficient tax invoices and the demand off-season jointly suppressed enterprise production enthusiasm.

In terms of inventory, social inventory of cast aluminium alloy ingots in China dropped to 25,900 tonnes, down by 3,800 tonnes W-o-W, marking eight consecutive weeks of destocking, with a cumulative destocking of 37,000 tonnes.

However, as demand remained weak, the pace of inventory decline further slowed from earlier periods, with the current situation more reflecting limited new arrivals due to low operating rates and continuous shipments from spot and futures traders jointly driving destocking. In terms of imports, overseas ADC12 quotations further pulled back to USD 3,050-USD 3,160 per tonne, while domestic prices remained relatively firm supported by costs.

The price spread between Chinese and overseas markets has continued to repair, and import losses have narrowed to within RMB 1,000 per tonne, with the import window improving slightly from earlier, but short-term import growth is expected to remain limited. Overall, short-term ADC12 prices will continue to move sideways.

On the cost side, tight aluminium scrap supply and tax invoice policies continue to build a price bottom, and enterprises hold firm in their willingness to maintain prices; however, weak off-season demand and slow recovery of end-user orders will continue to suppress upside room. Moving forward, close attention should be paid to primary aluminium price trends, changes in tax invoice policies, aluminium scrap circulation, and the pace of peak season order recovery.

Note: This article has been issued by SMM and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.

India: Imported aluminium scrap prices increase W-o-W; LME aluminium edges up

Fri, 24 Jul 2026 06:25:00 +0530

India's imported aluminium scrap prices increased w-o-w, supported by slightly stronger LME aluminium prices. According to BigMint's latest assessment for CFR Nhava Sheva deliveries, UK-origin zorba 95-5 scrap prices rose by USD 15/t w-o-w to USD 2,700 per tonne, while

LME aluminium edges up W-o-W

Three-month aluminium prices on the London Metal Exchange (LME) traded slightly higher w-o-w, closing at USD 3,175/t on 21 July against USD 3,167.5/t on 14 July, up by USD 7.5 per tonne, or 0.2 per cent W-o-W. Meanwhile, LME aluminium inventories declined by 4,825 t, or 1.7 per cent W-o-W, to 279,775 tonnes on 21 July from 284,600 tonnes on 14 July.

LME aluminium prices edged up W-o-W, supported by declining exchange inventories and continued concerns over tight global supply. Although production has gradually improved following the easing of disruptions in the Middle East, lower LME stocks and ongoing supply-side uncertainties continued to underpin market sentiment and keep prices firm.

Market scenario

Market sentiment remained weak and cautious amid continued volatility in LME aluminium prices. Limited buying interest and sluggish spot activity prompted buyers to procure only immediate requirements, resulting in muted trading and a weak imported scrap market, with price variations persisting across grades.

This image has been sourced from BigMint official website

On the domestic front, aluminium scrap prices showed mixed trends during the week. Casting-grade scrap prices in northern India declined amid subdued buying activity, while other scrap categories recorded gains on improved demand. Meanwhile, casting-grade scrap prices in Southern India remained largely stable w-o-w.

Chinese silicon prices

According to BigMint's latest assessment, China-origin Silicon Metal 553 prices remained stable w-o-w at USD 1,350 per tonne CFR Mundra, amid balanced market fundamentals, firmer Chinese export offers, and comfortable supply availability.

Outlook

Imported aluminium scrap prices are expected to remain stable to firm in the near term, supported by firm LME aluminium prices and lower exchange inventories. However, weak buying interest and cautious procurement are likely to limit significant price gains.

Discover expert perspectives and comprehensive coverage of the aluminium value chain in the e-Magazine - Mine to Market: ALuminium Producers & Manufacturers 2026

Note: This article has been issued by BigMint and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.

US aluminium scrap recovery continues to strengthen into 2026 with a 14% jump Y-o-Y

Thu, 23 Jul 2026 17:30:00 +0530

US aluminium scrap recovery continued to strengthen at the start of 2026, with recycled metal production rising by double digits year on year, while primary aluminium output remained largely unchanged, according to the latest US Geological Survey (USGS) Mineral Industry Survey.

A total of 318,000 metric tonnes of aluminium was recovered from scrap in January 2026, up 14 per cent from the same month last year compared to 297,000 tonnes and 3 per cent higher than the revised December 2025 figure.

Of the total, 179,000 metric tonnes came from new scrap and 138,000 metric tonnes from old scrap.

Meanwhile, primary aluminium production totalled 58,000 tonnes during the month. Average daily output stood at 1,860 metric tonnes, unchanged from December 2025 and 1 per cent higher than January 2025.

Aluminium prices continue to rise

US aluminium prices strengthened significantly during the month.

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The average US spot price for primary aluminium reached USD 2.42 per pound in January 2026, rising 10 per cent from December and 71 per cent compared with January 2025.

On the London Metal Exchange (LME), the average cash price increased to USD 1.43 per pound, up 9 per cent month on month and 22 per cent year on year.

At the end of January, inventories of primary aluminium in LME-approved warehouses in the United States stood at 6,239 tonnes, down 24 per cent from the previous month. Stocks of aluminium alloy remained unchanged at 120 tonnes.

Tariff changes and smelter restart

The survey also highlighted recent policy developments affecting the US aluminium industry.

On April 2, 2026, US President Donald J. Trump announced the revised Section 232 tariff rules which covered aluminium, steel and copper imports. Under this, a 50 per cent duty on primary products and a 25 per cent duty on selected derivative products will be applied to the full customs value of imported goods rather than only to their metal content.

The measures form part of a broader effort to expand domestic aluminium production capacity.

Century Aluminum also announced on April 16, 2026, that it had restarted previously idled potlines at its Mt. Holly smelter in South Carolina. The facility has an annual production capacity of 229,000 tonnes and is expected to return to full production by June 2026.

For more insights on sustainability and the recycling market, read - Sustainability & Recycling: Aluminium's Dual Commitment

Secondary aluminium margin trap: How toxic dross, CBAM, and 2.5% import duty are destroying the recycling arbitrage

Thu, 23 Jul 2026 06:25:00 +0530

EXECUTIVE SUMMARY:

The carbon legislation trap: The CBAM Omnibus 2025 update has eliminated the zero-emission loophole for pre-consumer scrap. Secondary aluminium producers using primary factory off-cuts must now declare massive upstream carbon footprints, destroying their European export margins.
The geopolitical squeeze: As the EU prepares to ban metal scrap exports, import-dependent nations face a catastrophic supply deficit. Indian aluminium recyclers are uniquely crippled by a 2.5 per cent Basic Customs Duty on scrap, creating an inverted duty structure that heavily favours zero-tariff ASEAN competitors.
The zero-waste imperative: Environmental regulators are aggressively shutting down informal dross processors. To survive, the industry must pivot to AI-driven LIBS precision sorting to bypass the furnace entirely and adopt hydrometallurgy to transform toxic black dross into highly profitable refractory minerals.

The secondary aluminium industry is undergoing a profound structural and economic transformation. Historically championed as the ultimate circular economy success story, secondary aluminium production consumes approximately 5 per cent of the energy required for primary electrolytic smelting. It actively avoids the massive carbon footprint associated with bauxite mining and the Hall-Héroult process.

However, the foundational economics of the secondary aluminium sector are currently being disrupted by an escalating, multifaceted crisis. What was once a straightforward margin play is now a highly complex labyrinth of metallurgical constraints, tightening carbon regulations, geopolitical resource nationalism, and hazardous waste burdens.

Today, high-quality secondary aluminium scrap frequently trades at more than 90 per cent of the primary London Metal Exchange (LME) ingot price. This convergence effectively obliterates the traditional cost arbitrage that subsidised the operational inefficiencies of the recycling sector. As global aluminium consumption scales past 100 million tonnes, the industry must immediately confront the thermodynamic limits of tramp elements, the severe regulatory shifts of the Carbon Border Adjustment Mechanism (CBAM), and the fracturing of global scrap supply chains.

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The thermodynamic dead end: Dilution and dirty alloys

At the absolute core of the hidden cost crisis in secondary aluminium production is an immutable law of thermodynamics. Standard remelting and fluxing processes are fundamentally incapable of purifying liquid aluminium. Unlike steel or copper recycling, aluminium's extreme reactivity means that once tramp elements enter the molten bath, they remain entirely in solution.

When an end-of-life vehicle or mixed consumer product is mechanically shredded, highly diverse aluminium alloy grades are conflated into a single, heterogeneous scrap stream. Iron is universally recognised by metallurgists as the most damaging contaminant in this matrix. When iron concentrations exceed a highly sensitive threshold of just 0.2 wt%, it reacts during cooling to form exceptionally brittle intermetallic phases (specifically Al₃Fe and the needle-like Al₅FeSi).

For a downstream manufacturer, the commercial consequence of these microscopic stress concentrators is catastrophic. It leads directly to premature part fractures during stamping, devastating defect rates on the factory floor, and massive downstream warranty claims. Because these tramp elements cannot be fluxed out of the melt, secondary producers have historically been forced to rely on two highly inefficient, cost-heavy strategies.

The first strategy is downcycling. Contaminated scrap cascades into lower-value cast alloys, such as the Al-Si-based 300 series, which can tolerate higher impurity loads. However, the rapid electrification of the global automotive sector is driving immense demand for high-strength wrought alloys, while demand for traditional cast engine blocks is stagnating. Downcycling is now a commercial dead end.

The second strategy is dilution, known as sweetening. This involves adding high-purity virgin primary aluminium to the scrap melt to artificially suppress the concentration of tramp elements. Sweetening introduces massive hidden costs by requiring premium-priced primary aluminium. More critically, in the modern era of carbon accounting, introducing primary metal injects a massive carbon penalty into the final product.

Carbon economics and the CBAM omnibus shockwave

As metallurgical limitations drive up raw operational costs, the international regulatory environment is concurrently imposing unprecedented financial penalties. The European Union's Carbon Border Adjustment Mechanism (CBAM) entered definitive financial enforcement on January 1, 2026, fundamentally altering the global cost curve.

Primary aluminium production is intensely electricity-dependent. If this power is sourced from coal-dominated grids, the embedded emissions can soar to between 16.0 and 16.5 tCO₂e per tonne. Secondary aluminium production bypasses the electrolytic reduction process entirely, resulting in a drastically lower carbon footprint of 0.05 to 0.5 tCO₂e per tonne.

However, a highly disruptive regulatory update known as the CBAM Omnibus Regulation (EU 2025/2083) has injected a massive hidden cost into the secondary supply chain.

Under the original 2023 CBAM framework, secondary producers could purchase pre-consumer manufacturing scrap (such as machining chips or dross generated by high-carbon primary smelters) and classify this input as "zero-emission" scrap. The CBAM Omnibus 2025 explicitly dismantled this circumvention route. Under Article 7a, any pre-consumer scrap utilised by a secondary smelter must legally carry forward the exact embedded emission factor of the original primary production process from which it was generated.

For secondary producers relying on pre-consumer scrap from coal-powered primary giants, this is a devastating recalculation. Their exported product will now carry a weighted average reflecting the coal-heavy primary footprint, subjecting them to severe CBAM penalties. Consequently, verified post-consumer scrap has skyrocketed in strategic value, driving prices further toward primary parity.

Geopolitical chokepoints and the Indian tariff crisis

Because CBAM financially penalises the use of primary metal or pre-consumer scrap for dilution, the only economically viable pathway is to secure vast, uninterrupted quantities of high-purity post-consumer scrap. However, this necessity is colliding with a rapidly fracturing global geopolitical landscape.

Major economies are erecting aggressive legislative barriers to prevent scrap export. The most consequential of these is the European Union’s revised Waste Shipment Regulation (WSR). Slated for strict enforcement, the updated WSR will prohibit the export of non-hazardous recyclable aluminium scrap to non-OECD countries. Removing this massive supply node from the open global market guarantees intense procurement competition and exponential price spikes for developing nations.

The immediate impact of these global supply shocks is most acutely visible in India, the world's largest importer of aluminium scrap. India’s domestic per capita aluminium consumption remains historically low, meaning the country lacks a mature domestic reservoir of end-of-life scrap. Consequently, the Indian secondary industry must import between 80 and 85 per cent of its total scrap requirements.

Despite this near-total reliance on foreign raw materials, the Indian government imposes a crippling self-inflicted cost: a 2.5 per cent Basic Customs Duty (BCD) on imported aluminium waste and scrap, classified under HSN Code 7602.

Delve deeper into the recycled aluminium and secondary aluminium market with our World Recycled ALuminium Market Analysis Industry forecast to 2032

Financial Reality Check: At current premium scrap valuations, this compounded 2.5 per cent BCD and surcharge structure inflicts an estimated, unavoidable penalty of USD 50 to USD 70 per tonne directly onto the Indian recycler's working capital, bleeding cash from the balance sheet before the furnace is even ignited.

When stacked sequentially with an 18 per cent IGST and a 10 per cent Social Welfare Surcharge, the landed cost of scrap is severely inflated. As the Material Recycling Association of India (MRAI) has vehemently highlighted, this creates a crippling inverted duty structure. Competing manufacturing economies operate under a 0 per cent aluminium scrap import duty regime. Furthermore, finished secondary aluminium alloys manufactured in ASEAN nations frequently enter the Indian market completely duty-free under various Free Trade Agreements (FTAs). Indian recyclers are forced to compete in their own domestic market against foreign manufacturers who enjoy zero-duty raw material inputs.

The dross liability: WBPCB crackdowns and zero-waste technologies

Beyond the geopolitical complexities of procurement, the physical processing of secondary aluminium generates a highly problematic byproduct: black dross.

Depending on the raw mix, secondary operations generate between 200 and 600 kg of black dross per single tonne of aluminium metal produced. It contains a vast matrix of aluminium oxide (Al₂O₃) and massive concentrations of soluble chloride salts. Critically, black dross is laced with highly reactive impurities, specifically aluminium nitride (AlN) and aluminium carbide (Al₄C₃). When exposed to ambient humidity, these compounds undergo rapid hydrolysis, releasing a cocktail of poisonous and explosive gases, including ammonia (NH₃) and methane (CH₄).

The era of cheap, informal dross disposal is abruptly ending. Environmental regulators are aggressively enforcing hazardous waste compliance. A stark illustration of this shift is evident in the recent enforcement actions taken by the West Bengal Pollution Control Board (WBPCB) in India. The Howrah and Hooghly districts have seen a wave of aggressive closure orders executed against units attempting to process dross without adequate Air Pollution Control Devices. Facilities utilising rudimentary coal-fired Tapai Bhatti furnaces with defunct suction hoods face immediate electricity disconnection, effectively eliminating the informal dross processing sector in the region.

To mitigate these massive regulatory liabilities, the industry is rapidly pivoting toward hydrometallurgical processing. This cold-processing wet technique utilises aqueous leaching to dissolve the hazardous chlorides. Advanced bench-scale research has demonstrated the ability to recover over 97 per cent of the flux salts through the evaporation and crystallisation of the leachate. These recovered high-purity salts can be cycled directly back to the smelting furnaces. Simultaneously, the water-insoluble oxide residue is transformed from a hazardous waste into a highly valuable secondary mineral resource boasting an alumina purity exceeding 98 per cent, ideal for synthesising high-performance refractory products like magnesium-aluminium spinel (MgAl₂O₄).

Defeating the ceiling: AI, XRT, and LIBS precision sorting

The compounding pressures of thermodynamic limits, CBAM penalties, geopolitical scarcity, and toxic dross management lead to a singular operational conclusion. The only viable strategy is to defeat the thermodynamic ceiling before the scrap ever reaches the melting crucible.

This imperative has catalysed a technological revolution in AI-driven precision sorting. The foundational layer relies on X-Ray Transmission (XRT) technology, which excels at the binary separation of light metals from heavy tramp contaminants such as copper, brass, and free iron.

However, to achieve true alloy-specific separation, the industry has turned to dynamic Laser-Induced Breakdown Spectroscopy (LIBS). As scrap fragments hurtle down a conveyor belt, a high-energy laser pulse ablates a microscopic layer of the metal, generating a localised microplasma. A high-resolution spectrometer captures this optical signature in milliseconds, allowing AI algorithms to instantly quantify the exact concentrations of specific alloying elements (Si, Mg, Cu, Zn, Mn, Fe).

The economic viability of multi-sensor AI sorting is perfectly illustrated by the operations of Raffineria Metalli Cusiana S.p.A. in Italy. By installing a fully automated, multi-stage sorting architecture capable of processing 100,000 tons per annum, Cusiana fundamentally restructured its profitability. By achieving virgin-like purity from 100 per cent post-consumer scrap, they introduced branded "Recall" ingots, perfectly engineered to bypass impending CBAM taxes.

More innovatively, the LIBS-sorted scrap achieved such pristine elemental precision that Cusiana could bypass their own melting furnaces entirely for specific streams. They now sell premium, furnace-ready, alloy-specific scrap directly to downstream manufacturers, completely eliminating the massive time and energy expenditure associated with traditional ingot casting.

Explore why verification, traceability and carbon footprint reporting become essential in AL with our upcoming webinar by Alberto Monje Gama, Sustainability Policy Manager, TIC COUNCIL, on “Recycled aluminium, CBAM and trust: Why verification matters for Europe's circular economy”

The Strategic Conclusion

The prevailing narrative that secondary aluminium production is a universally low-cost pathway to sustainability is operationally obsolete. The industry is navigating a severe crucible of hidden costs that requires an immediate transition from bulk volume processing to precision metallurgical engineering.

Facilities that cling to rudimentary sorting, carbon-intensive dilution, and informal dross dumping will be swiftly and permanently priced out of the market by CBAM and regional environmental regulators. Conversely, operators who aggressively integrate AI-driven LIBS sorting, zero-waste hydrometallurgy, and rigorous supply-chain carbon traceability will capture the immense, unparalleled margins waiting in the decarbonised circular economy of the next decade.

Note: This is exclusive coverage by AL Circle and may not be reproduced, republished or shared without prior permission.

Disclaimer: The opinions, information, claims, references, and images presented here are those of the author alone and AL Circle holds no responsibility.

Japan's aluminium scrap imports from EU jump 90% in Q1’26 despite soaring prices

Mon, 20 Jul 2026 12:30:00 +0530

Japan’s aluminium scrap imports from the European Union in the first quarter (Q1) of 2026 have reported an almost 90 per cent year-on-year surge.

In Q1 2026, Japan imported a total of 35,794 tonnes of aluminium scrap, of which 3,613 tonnes or 10.09 per cent, was imported from the EU.

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Comparing the Q1 volume over the years, a rising streak can be noted in Japan’s aluminium scrap imports from the EU:

Q1 2026 – 3,613 tonnes, rising 89 per cent Y-o-Y from the 1,902 tonnes in Q1 2025

Q1 2025 – 1,902 tonnes, rising 40 per cent Y-o-Y from the 1,357 tonnes in Q1 2024

Concurrently, the annual shipment volume from the EU to Japan has witnessed a sharp Y-o-Y surge to 9,346 tonnes in 2025 from 5,815 tonnes in 2024.

According to the data recorded in the International Trade Administration (ITA), the Q1 import value of Japan’s aluminium scrap from the EU is worth USD 3.26 million, marking a Y-o-Y gain of 45.54 per cent from USD 2.24 million recorded in Q1 2025.

Hence, Japan’s aluminium scrap imports from the EU in Q1 2026 have risen Y-o-Y despite an almost 50 per cent hike in the pricing segment.

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Japan’s import volume accounted for about 3.58 per cent of the EU’s total export volume of 100,988 tonnes.

As of Q1 2026, the EU ranks third among the top three overseas aluminium scrap sources for Japan. The top 2 sources are:

The US – 15,907 tonnes or 44.44 per cent of the total

Taiwan – 8,187 tonnes or 22.87 per cent of the total