Aluminium UBC Spreads Widen as Scrap Flows Shift East

Aluminium UBC Spreads Widen as Scrap Flows Shift East

The aluminium scrap corridor from Germany into India is showing material spread opportunity today, with UBC (used beverage cans) landed at approximately $2,040/MT and gross margins sitting at 12.8%—equivalent to roughly $260/MT net of transport, duties, and handling. Confidence in this corridor stands at 0.78, reflecting reasonable data consistency across recent transactions.

This widening reflects structural shifts in regional supply and demand. Indian mills continue to absorb imported scrap at steady rates, while European collection volumes remain seasonal. The margin cushion suggests traders and recyclers have pricing room to negotiate, though execution remains subject to vessel availability and port congestion typical of mid-June.

By contrast, the copper millberry corridor—Poland to Turkey—remains tighter. Gross margin of 5.0% (~$425/MT) with landed cost near $8,575/MT reflects a more compressed arbitrage. Confidence here is 0.72, indicating slightly more volatility in recent pricing data. Turkish smelters remain active buyers, but the narrower spread leaves less room for error on logistics or timing.

What Drives the Gap

Three factors explain the aluminium-copper spread divergence:

• Seasonal supply: European UBC collection peaks in summer; Polish copper scrap supply is more consistent year-round.
• Regional demand: Indian aluminium demand remains strong; Turkish copper intake is steady but not aggressive.
• Logistics cost: Aluminium's lower density improves container economics on longer routes; copper's weight works against Poland-Turkey proximity.

Traders should note that both corridors remain viable for physical-backed trade finance, but the risk-reward profile differs. The aluminium spread offers more cushion for unexpected delays or cost overruns; the copper corridor demands tighter execution and faster turnover.

Summer logistics tightening—vessel delays, port congestion, holiday schedules—will likely compress both margins further by late June. Early-month positioning may favour those locking in rates now.

All figures are indicative, net of standard landed costs. Spreads exclude financing, insurance variance, and counterparty-specific terms. Confidence scores reflect data consistency only, not execution certainty.

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ArbiTrade provides market intelligence and coordination only. It does not execute trades, hold funds, act as a counterparty, or guarantee pricing, execution, or profit. This article is general commentary, not investment, legal, or trading advice. Conduct independent diligence before transacting.