Base metals prices on LME witness gains amid falling inventories

Base metals prices on the London Metal Exchange (LME) witnessed positive trends amid dropping inventories as of the last closing. Lead witnessed the largest gain in prices.

Three-month aluminium futures gained by 0.8% to $2,253/tonne (t), nickel prices were at $17,983/t (up 1.5%), copper prices settled at $8,640/t (up 0.7%), zinc edged up by 1.6% to $2,535/t, and lead prices gained by 2% to $2,108/t.

COMEX market

Copper prices on the Commodity Exchange (COMEX) gained by 1.3% to $8,623/t from $8,514/t compared to the previous closing.

India's non-ferrous market

Domestic aluminium prices remained largely stable as of yesterday. Domestic copper prices rose by 0.3%. Armature scrap prices were at INR 691,000/t, secondary rods at INR 731,000/t ex-Delhi. Brass honey scrap (4%) from the Middle East increased by 1% w-o-w to $5,490/t.

India's zinc market saw rising prices, with zinc ingot prices hitting INR 225,000/t, up 1.8% w-o-w due to a INR 4,000/t hike in HZL prices. Remelted lead prices stayed stable at INR 176,000/t, ex-Delhi. Middle East zinc diecast (5%) increased by 0.5% w-o-w after LME zinc price rises.

Global updates

Japan's current account surplus soars

In January, Japan's current account surplus reached 438.2 billion yen, defying expectations of a deficit. Exports rose by 7.6%, led by demand for cars and chip-making equipment, while imports fell by 12.1%, primarily due to declines in coal and LNG.

China's electric vehicle sales: mixed growth trends

China's pure electric vehicle sales saw a slower growth in January-February compared to the same period last year, attributed to intensified competition and price cuts by market leader BYD. Battery-powered EV sales rose by 18.2%, reflecting a cooling trend from 20.8% in 2023, partly due to consumer interest waning amidst cold weather affecting battery performance. However, sales of new energy vehicles (NEVs), including plug-in hybrids, surged by 37.5%, outpacing the overall passenger car market's growth of 16.3% in the first two months.

Copper smelters navigate market challenges

Chinese copper smelters, facing unsustainable processing fees for copper concentrate, may discuss production cuts next week. Tighter concentrate supply and overcapacity in smelting exacerbate challenges. Global copper concentrate market could see a deficit this year, while smelting capacity is set to increase, intensifying competition for concentrate.

Japan's consumer spending plummets, economic concerns loom

Japanese consumer spending in January saw the largest drop in 35 months, down 6.3% y-o-y, blamed on factors like decreased car purchases and warm weather lowering energy bills. Market anticipates Bank of Japan's exit from negative interest rates, despite ongoing economic weaknesses.

China's central bank pledges stability amid economic challenges

China's central bank vowed flexible and precise policy to bolster domestic demand and ensure price stability amid an uneven economic rebound and deflationary pressures. Emphasising policy coordination, market-oriented approaches, and stabilising the yuan exchange rate, it aims to address challenges while promoting economic resilience and growth.