The Aluminium Alloy Ingot market is undergoing a dynamic transformation across North America, shaped by rising automotive demand, evolving trade policies, and shifting raw material strategies. In Mexico, prices for ingot are on the increase due to strong vehicle sales and looming import tariffs, which have raised questions over scrap usage, with producers using more primary aluminium and direct ingot inputs. Meanwhile, a U.S. rally is underway, fuelled by supply constraints from China and improved trade sentiment. Both electric and traditional vehicles continue to strengthen demand for the Aluminium Alloy Ingot, thereby increasing its importance for automotive and transport industries.
Aluminium Alloy Ingot prices in Mexico increased by 1% week-on-week in late October as the gap in die-casting capacity and surging demand from the automotive segment boosted the prices. This was supported by a 10.71% month-on-month increase in light vehicle sales, according to its national statistics agency, Instituto Nacional de Estad铆stica y Geograf铆a (INEGI), which recorded 129,736 units during the month.
The proposed import tariffs, scheduled to be imposed by the Mexican government to protect domestic industries, will have a very significant effect on the Aluminium Alloy Ingot market. Tariffs of 50% and 35% may be levied on major downstream industries like automobiles and motorcycles (along with its parts). It is expected that the protectionist approach will drive growth in Mexico's overall aluminium value chain, thereby increasing demand for Aluminium Alloy Ingot and enhancing scrap recycling's contribution toward fulfilling production requirements.
Changes in scrap dynamics are reshaping Aluminium Alloy Ingot production in Mexico. Scrap types such as Tense (shredded auto parts) and Talon (aluminium wires) remain in demand because of their higher recovery rates and easier processing, while UBCs see lower trade volumes due to higher impurity levels, labour-intensive processing, and increasing demand from the U.S. market. With scrap prices rising-to be driven higher by heightened exports to the U.S. under the tariff-free USMCA framework-Mexican producers have increasingly moved away from using scrap and toward P1020 primary aluminium in secondary Aluminium Alloy Ingot production.
With costs continuing to rise, Mexican aluminium processors are reassessing their raw material strategies, and some have started moving towards direct use of either Aluminium Alloy Ingot or primary aluminium ingot rather than scrap, for which the cost advantage has broadly disappeared. Nevertheless, demand for Aluminium Alloy Ingot-especially for grades such as ADC12 and A380-remains buoyant, underpinned by Mexico's well-established automotive and transport manufacturing base. Pricing pressure persists in the market for Aluminium Alloy Ingot, exacerbated by persistent uncertainties over tariffs and Mexico's profound dependence on trade with the United States.
US Aluminium Alloy Ingot prices jumped up 2.6% over the week ended October 31, extending a vigorous upward trend on the back of tighter supply conditions in China and an improved demand outlook. The rally gained more momentum with easing trade tensions after the recent US-China trade agreement temporarily removed a key source of uncertainty affecting global metals markets and Aluminium Alloy Ingot pricing.
The US Aluminium Alloy Ingot market has faced two big hurdles this year in rising costs due to tariffs and a major outage at a key rolling mill supplying automotive-grade sheet. Those challenges have accelerated the growth of an under-the-radar segment of the secondary Aluminium Alloy Ingot market. With automakers continuing to raise aluminium content in vehicles to improve fuel efficiency and corrosion resistance, demand for Aluminium Alloy Ingot remains strong even as supply continues to experience volatility.
EVs, although showing a slight slackening of growth, are expected to continue to drive a substantial proportion of demand growth for Aluminium Alloy Ingot in the future. Conventional internal combustion engine vehicles have continued to increase their usage of Aluminium Alloy Ingot in recent years, with body panels, chassis components, and wheels now often incorporating the material to boost performance and reduce overall vehicle weight.
