Healthy aluminum markets continue in 2004, with most producers predicting resurgence in demand for 2005. A significant spike in high-grade demand occurred last April, based largely on concern of a rail strike in the U.S. as well as rising energy costs. This led the market to price ingot at over 82 cents per pound (U.S. dollars). For most of the summer months, this activity moderated to the 76 to 80 cent range (see chart).
The strength in high-grade metal has meant that buyers of secondary and recycled inputs are eager to get bales of used beverage containers (UBC) and other aluminum scrap on the market. Bale prices for UBC have bounced this summer in a range of 61 to 65 cents pound (U.S. dollars) in eastern North America, with western prices characteristically 3 cents lower due to transportation costs (see chart). A strong fourth quarter is anticipated.
In opposition to the pricing strength, North America has seen an estimated fifteen per cent fall in reported aluminum recovery from households over the past decade. Waste Diversion Ontario’s Municipal Datacall – which asks municipalities to provide statistical data for waste generation and diversion activities on an annual basis — reported a 6.2 per cent drop in aluminum cans recovered through Ontario’s curbside recycling program, compared against 2002.
This trend, however, only provides a partial picture. Industry sources report that cans are increasingly coming back through other non-curbside collection outlets, resulting in lower revenues to municipalities. Focused advertising campaigns in Ontario municipalities and elsewhere could help to reverse this trend.
Contact Damian Bassett at 416-594-3457, ext 3457 or visit www.csr.org (CSR Sheet located under “Publications”)