
You know that China celebrates the New Year (Spring Festival) holidays, which often occur from late January to mid-February. The National Golden Day Week is another event which has 7 holidays, its effect is less, but it also affects. These 1–3-week holidays affect many factors, which ultimately cause an increased price of aluminum scrap and other manufacturing industry-related things. This article will provide comprehensive knowledge of why Al scrap prices increase ahead of holidays, their impact and outlook. So, let’s begin.
Aluminum Scrap Market Update
You will get the latest update about the Aluminum scrap market in this section, like the ongoing prices or which type of Al grades have become expensive now.
Latest Price Trends
According to our research, we have noticed a big rise in the prices of aluminum scrap ahead of the Chinese holidays. You will be surprised to know that the price surge for some grades is 10-15%. If we see the history of the prices surge, it is consistent. But now the market pressure is so prominent that this price surge is difficult to handle.
The following table shows showing pre-surge prices of Al then during holidays.
| Period | Average Price (RMB/ton) | Key Market Event |
| October 2023 | 15,200 | Normal market conditions |
| November 2023 | 15,800 (+4%) | Pre-holiday stockpiling begins |
| December 2023 | 16,500 (+4.4%) | Increased hoarding activity |
| January 2024 | 17,300 (+4.8%) | Factories begin holiday shutdowns |
| Early February 2024 | 18,100 (+4.6%) | Chinese New Year supply crunch |
| March 2024 | 17,600 (-2.8%) | Post-holiday market adjustment |
A 12% price surge in the three months leading up to the Chinese New Year. 8% price surge remains after post-holiday management.
Types of Aluminum Scrap Affected
You know that mostly manufacturers work with extrusion scrap, turnings and mixed low-copper scrap, which means the demand is high for these Al scraps. Due to high demand, the price surge is high for these types of aluminum scraps. These types can be reasons behind supply disruptions because they are critical for secondary aluminum production.
Factors Behind the Price Surge
There are many factors which play a role in the price hike during holidays. These factors can be economic, logistical or seasonal. Let’s figure out some critical price surging factors in this section:
Seasonal Shutdowns
- During holidays, since labor does not work, that’s why the scrap processors and secondary aluminum scrap smelters shut down operations for weeks.
- Due to lower industrial activity, the production of Al scrap reduces, so ultimately an increase in the costs because of the consistent demand.
Reduced Scrap Availability
Scrap availability becomes an issue in Chinese holidays because of many factors:
- During holidays, scrap collectors pause scrap collection
- The government imposes strict regulations on the scrap melting in pollution-prone regions
- The manufacturers stop working on extrusions, turnings, etc., which reduces scrap availability
- China’s “Zero Waste Import” policy stops scrap transportation in the country
- Logistics disruptions due to weather conditions
Trader Strategy and Demand Pressure
Before holidays, some traders buy extra aluminum scrap and stock it. During holidays, when the aluminum shortage begins, prices rise, and they start to sell it. After the holidays, when prices decrease, they still sell that scrap at a good profit.
Market Impact
The market impact of the Al scrap price surge means how this surge affects a lower-level manufacturer at a factory. In this section, we will discuss how badly the price surge affects the market in China and at the global level.
Domestic Industry Effects
The aluminum scrap price surge has these three effects on domestic industries:
- You know what happens first, the price squeeze, like the material costs, is now 10-15% higher than old prices.
- During holidays, due to lower material availability, manufacturers pause manufacturing, which ultimately increases product prices.
- Due to lower stock availability, small manufacturers shift towards primary Al at higher costs. For instance, a Zhejiang-based auto-parts manufacturer reported 15% lower margins due to price hikes.
Global Market Ripple Effects
During Chinese holidays, due to a shortage of aluminum scrap, international customers may face delays in deliveries and a rise in the product prices.
Sector-wise Reactions
The following table shares the impact of the scrap price surge in 3 different industries, then how these issues are tackled.
| Industry | Impact | Response |
| Construction | Delays in aluminum parts (e.g., frames, cladding) | Use cheaper materials temporarily |
| Automotive | Higher costs for recycled aluminum parts | Negotiate long-term scrap contracts |
| Packaging | More expensive cans/bottles | Pass costs to consumers |
Outlook
Outlook means how we see future development in China during the price surge:
Short-Term Price Behavior
Prices will increase by 12-15% from pre-holiday times until the full production resumes. Price hike can be even higher for coastal industries due to increased export demand.
Post-Holiday Market Adjustments
Prices will drop slowly, say 3-5% per month, once production resumes completely after the holidays. Unloading of stockpiles will reduce prices further.
Long-Term Forecasts
Here is what can happen in the next two to three years to mitigate that price surge.
| Factor | Impact | Projected Trend |
| China’s Green Policies | Stricter recycling standards | Prices stay 8-12% higher than 2023 averages |
| Global Scrap Demand | EU/US push for circular economy | China faces more import competition |
| Energy Costs | High smelting electricity prices | Scrap remains cheaper than primary aluminum |
Conclusion
We conclude that the aluminum scrap price surge due to Chinese holidays is an important issue to tackle because it causes issues shortage of scrap and increased Al product prices. Stakeholders need to be prepared for short-term disruptions and explore long-term solutions or policies to mitigate risks in future.
FAQs
Why do aluminum scrap prices rise during the Chinese New Year?
These are the main causes:
- Seasonal shutdown of scrap facilities
- Reduced supply
- Trader stockpiling
Will global aluminum prices be affected by China’s scrap market?
Yes, of course, it will affect the global supply of Aluminum scrap because China plays an important role overall in Al scrap.
What should manufacturers do during such price surges?
- Diversify supply sources
- Increase inventory buffers
- Explore alternative materials

