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India: Copper rods, scrap prices rise w-o-w as LME rebounds from 4-month lows

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Copper
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16 Aug 2024, 18:54 IST
India: Copper rods, scrap prices rise w-o-w as LME rebounds from 4-month lows

Domestic copper armature prices are assessed at INR 737,000/t exy-Delhi, reflecting an increase of 1.5% w-o-w. Notably, copper futures on the London Metal Exchange (LME) have hit a 4-month low having tumbled to $8,750/t recently, although prices rebounded 3% w-o-w to $9,150/t today.

Prices of secondary CCR rods (99%) were at INR 783,000/t ex Delhi, rising by 1.7% w-o-w. Meanwhile, primary CC rods were observed at INR 815,000/t, up by 2.5% w-o-w. Imported scrap prices have increased by up to 1.5% w-o-w.

LME prices rebound after hitting 4-month low

Copper inventories in LME warehouses have doubled to 308,000 t since June 2024 and are currently at almost two- and-half year high.

Three-month LME copper prices hovered at $9,148/t, rising by 3% w-o-w.

Why are global copper prices rising?

A major workers' union leading the strike at BHP's massive Escondida mine, which accounted for nearly 5% of global copper production in 2023, aims to disrupt operations at the site.

A strike at BHP's Escondida mine in Chile has entered its third day, raising concerns over copper supply and boosting global prices. Despite initial talks, no resolution has been reached, with the union seeking a larger share of profits. Key facilities (Los Colorados concentration and electrowinning plants offline) remain offline, adding to supply worries and driving copper prices higher.

The outcome of the BHP-union talks could greatly affect global copper markets, depending on how long and severe the strike is. This shows how crucial mining is to the global copper supply chain.

Additionally, the U.S. dollar index, which fell to a one-week low to 102.70, also supported copper prices by making the dollar-denominated metal more affordable for buyers using other currencies.

BigMint's assessment of USA-origin talk scrap was at $4,690/t, 1.5% w-o-w rise, Middle East-origin largely from the UAE prices were recorded at $4,470/t, up by 0.2% w-o-w.

Copper motor mix scrap prices are being offered at $1,200-1,250/t by sellers based in the EU and the US. However, these prices seem to be higher than the bids currently being placed.

Buyers from Pakistan and the Far East are currently offering $50-60/t more than Indian buyers for copper motor scrap, giving them a competitive advantage in securing the material at current rates.

A buyer stated: "Although local prices are rising in response to the LME rebound, trade remains sluggish, and copper scrap availability is stable with no current shortage. In the northern region, buyers have stocked up before the monsoon leading to slow market activity. Meanwhile, the western region is actively procuring talk material, preferred over armature due to better labor facilities and its wider usage".

Trades were recently heard for mix copper motors from the US. Trades were at $1,150-1,180/t CFR Qasim.

Recent offers, deals

Brass honey Australia 2% was at 62% LME CFR Mundra.

Australia talk sold to CIF Chennai at 52.5% LME.

EU brass honey (5-6%) is offered at 58.25-58.5% CFR Mundra.

Mixed copper motors from the US were heard at $1120-1130/t CFR Mundra.

Mixed copper motors from the UK were traded at $1160-1180/t CFR Pakistan.

Alternator starter from Europe was heard at $1,900-1,950/t CFR Mundra.

Large motors from the UK and the US were heard at $1,060-1,100/t CFR Mundra.

Millberry from the US was heard at 99.25-99.5%. Millberry from the UAE was at 99% CFR Mundra.

Outlook

It is expected that copper prices in local market will remain positive in the near term as the ongoing strike and possible changes in U.S. monetary policy could be key factors in influencing the global copper market.

16 Aug 2024, 18:54 IST

 

 

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