Aluminium scrap escapes trade tariffs – what’s next?

Recycled aluminium imports are exempted from US trade tariffs – while India drops levies on non-ferrous scrap imports but excludes aluminium. In Europe, sentiment remains gloomy.

Sentiment in the European metal markets remains poor. The Association of German Metal Traders and Recyclers (VDM) regularly conducts a survey within the industry, with companies from across Europe participating. Its latest survey highlights how weak things are.

For Q1 2025, the VDM Business Climate Index has continued to decline, reaching a low of 44.9 points. The VDM Business Climate Index is composed of the assessment of the current business situation and business expectations of the surveyed metal traders. Both parameters have worsened.

‘Bleak’ months ahead

The business of metal trading had slightly improved at the beginning of the new quarter compared to the previous one but remains negative overall. None of the respondents reported an improvement in the business situation although only 26% confirmed a deterioration in economic conditions.

Nearly three-quarters of respondents (74%) see the situation unchanged compared to the previous quarter.

Expectations among metal traders regarding their economic development over the next three months remain bleak: 34% of the surveyed companies now look pessimistically at the new quarter, while only 7% expect an improvement in their business situation. More than half of the respondents (59%) assume that economic development will stagnate at the current level.

The supply of scrap at the beginning of the new quarter was no better than that of the last quarter of 2024. Only 11% of companies rated the supply as good with 32% seeing the current supply situation as worse than the difficult previous quarter.

Indian growth

The strength of the Indian economy is supporting the non-ferrous sector with higher prices for copper and aluminium scrap, according to the Bureau of International Recycling. The global recycling organisation’s latest non-ferrous ‘Mirror’ reports that India is set to be the most resilient economy among the world’s top 10 by 2027.

The PHD Chamber of Commerce and Industry, ‘the voice of India’s trade and industry’, expects the national economy to be the fourth largest by 2026 with 6.8% growth this year and 7.7% the year after.

Writing in the Mirror, Anirudha Agrawal, board member of BIR’s non-ferrous metals division, quotes Commerce Minister Piyush Goyal as saying that foreign direct investment into India is rising sharply, with investors from the Middle East, Japan, the EU and the USA seeing it as a top destination.

Read the full non-ferrous market analysis in our latest issue >>