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Kemet Share | Aluminum Industry Knowledge-Difference Between Primary Aluminum and Waste Aluminum

Release time:

2021-10-25

Waste aluminum is a common name for recycled aluminum, and it is also the main raw material for recycled aluminum. Generalized aluminum scrap is mainly divided into two categories, one is the new aluminum scrap, one is the old aluminum scrap.

waste aluminum is a common name for recycled aluminum, and it is also the main raw material for recycled aluminum . Generalized aluminum scrap is mainly divided into two categories, one is the new aluminum scrap, one is the old aluminum scrap.

1. What is waste aluminum

new waste aluminum refers to the process waste generated by downstream aluminum processing enterprises and foundry enterprises in the production process, or products that are scrapped due to unqualified performance. The new scrap aluminum is either recycled by the production company or transported to the aluminum electrolysis plant in exchange for the required aluminum ingots. It should be noted that when making waste aluminum statistics, there are few data due to the difficulty of statistics, so the statistical department generally does not include new waste aluminum in the statistical scope of waste aluminum.

Old scrap aluminum refers to scrap aluminum and scrap aluminum parts purchased from the society, including old aluminum doors and windows, aluminum parts in scrapped automobiles and machinery, aluminum conductors and aluminum metal parts in scrapped power grids, etc.

2. scrap aluminum classification

The price of scrap aluminum fluctuates every day, and the price of scrap aluminum in different regions is not the same. At present, scrap aluminum is mainly divided into the following pieces: broken cooked aluminum, broken raw aluminum, alloy aluminum, machine parts raw aluminum, tapping aluminum wire, etc. The difference between cooked aluminum and raw aluminum is that the content of aluminum in cooked aluminum is about 98%, the nature is relatively soft, can be rolled into various shapes, and has great advantages in corrosion resistance and hardness. Daily use of aluminum pot, aluminum lunch box, aluminum sheet, aluminum wire, aluminum tube, are cooked aluminum. The content of aluminum in raw aluminum is generally below 98%, with more impurities and more brittle and hard.

From the perspective of scrap aluminum recovery rate, the industry with high scrap aluminum recovery rate is the construction industry. The recovery rate of scrap aluminum in the process of building demolition is as high as 98%, while the recovery rate of scrap aluminum in the automotive industry can reach 95%. The recovery rate of remelted aluminum foil is 70%, and the recovery rate of aluminum beverage cans is relatively low, generally only 63%.

3. the relationship between waste aluminum and primary aluminum

There are theoretically two layers of relationship between waste aluminum and primary aluminum, one is the substitution relationship and the other is the supply relationship.

The substitution relationship is manifested in that both scrap aluminum and raw aluminum can be used to produce aluminum and aluminum alloys. Relative to primary aluminum, scrap aluminum and aluminum alloy ingots can maintain a stable price difference. After analysis, there are several reasons as follows:

First, waste aluminum belongs to waste resources. For the initial providers of waste aluminum, the cost required to obtain these waste aluminum resources is very low, which leads to a very large price reduction space for waste aluminum.

Second, the supply and demand relationship of waste aluminum is currently tight, which leads to the relatively strong control of waste aluminum prices by waste aluminum suppliers.

Third, the downstream industry of scrap aluminum is relatively single, and scrap aluminum is mainly used for the production of aluminum alloy ingots by recycled aluminum enterprises, with little other large-scale use.

Therefore, based on the cost characteristics of scrap aluminum and the game relationship between the scrap aluminum industry and the recycled aluminum industry, scrap aluminum suppliers provide recycled aluminum companies with a stable price difference between scrap aluminum and aluminum alloy ingots.

The price difference between aluminum alloy ingots and primary aluminum is not very stable. After analysis, there are also the following reasons:

First, the production cost of primary aluminum is very high. If you don't pay attention to the aluminum price, you will touch the production cost. When electrolytic aluminum plants are unprofitable, they choose to cut production, which leads to a reduction in supply and thus a rise in prices. The price reduction space of primary aluminum is relatively small relative to scrap aluminum, which directly leads to the instability of the price difference between aluminum alloy ingots and primary aluminum;

Second, the overall supply of primary aluminum remains in excess, and primary aluminum producers have relatively weak control over the price of primary aluminum.

Scrap aluminum can also be used to produce aluminum ingots, although the fine scrap price difference is not very stable, but also shows a strong positive relationship. If the price of primary aluminum is large, scrap aluminum suppliers will be reluctant to sell, thus driving up the price of scrap aluminum; when the price of primary aluminum is low, scrap aluminum suppliers will also consciously lower the price of scrap aluminum to make their products more competitive.

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