India: Copper scrap, rods prices rise w-o-w amid concerns over mine related shortages

Domestic copper armature prices were assessed at INR 740,000/t exy-Delhi, reflecting an increase of 1.5% w-o-w. Copper futures on the London Metal Exchange (LME) recently hit a 4-month low, falling to $8,750/t. However, prices have since rebounded to $9,250/t, reaching levels seen in mid-July. Prices of secondary CCR rods (99%) were at INR 790,000/t ex Delhi, rising by 2.6% w-o-w. Meanwhile, primary CC rods were observed at INR 822,000/t, up by 2.6% w-o-w. Imported scrap prices have increased by up to 2% w-o-w.

A buyer said, "Copper prices are climbing locally due to the rebound in the LME, coupled with a reported global shortage of copper caused by issues at mines."

LME prices rise w-o-w despite increase in stocks

Copper inventories in LME warehouses have doubled to 319,625 t since June 2024 and are currently at almost three-year high and 12,200 t higher w-o-w. Three-month LME copper prices hovered at $9,240/t, rising by 1.5% 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 entered its second week with no resolution in sight. This labour dispute has added to supply concerns, lending support to prices.

A source said: "China is actively purchasing copper from Pakistan, Australia, and Germany, with the port issue at Damaiyu showing signs of easing after months of disruption."

The source further said: "China's buying inquiries for motors and specific grades like Millberry, Candy berry, Cloves, and Birch Cliff have increased from Australia after months of slow activity. The BHP strike has also contributed to a perceived copper shortage, driving prices higher."

Imported price trend

BigMint's assessment of USA-origin talk scrap was at $4,900/t, a 4.5% w-o-w rise, Middle East-origin largely from the UAE prices were recorded at $4,600/t, up by 2.9% w-o-w.

Copper motor mix scrap prices are being offered at $1,190-1,200/t by sellers based in the EU and the US. However, these prices seem to be higher than the bids currently being placed, Although BigMint noted traded levels concluding at $1,160-1,170/t.

US Fed expected to cut rates in September

The Federal Reserve is likely to cut interest rates in September, as indicated by the minutes from its July meeting. Most officials viewed a rate reduction as appropriate if economic conditions remain stable.

Global refined copper production rises

The International Copper Study Group (ICSG) recently unveiled preliminary figures showing that global refined copper production increased by about 6% in the first six months of 2024 (H1CY'24) with both primary production (electrolytic and electrowinning from ores) and secondary production (from scrap) up by 6.3%.

Trades, offers heard for the week

• UAE (Saudi) brass honey was traded at 59.5% CFR China for 200 t.
  
  
• UAE brass honey was traded at 60% CFR Mundra.
  
  
• Kuwait brass honey was traded at 59.5-60% CFR Mundra.
  
  
• UK brass honey was traded at 57.75% CFR Mundra.
  
  
• Dammam brass honey was traded at 59% CFR Mundra.
  
  
• Mix motors from USA to Qasim were traded at $1,180/t
  
  
• Sold small motors from USA to port Qasim at $1,240/t
  
  
• Copper Millberry from Australia sold at 99% LME CFR China.
  
  
• Copper CLOVE No. 1 (99.99%) from Australia sold at 98% LME CFR China.
  
  
• Copper CLOVE No. 2 (98%) from Australia sold at 96% LME CFR China.
  
  
• Copper Candy Berry from Australia heard at 97% LME CFR China.
  
  
• Candy Berry bid from India at 96% LME.
  
  
• Copper brass honey (2%) from Australia sold at 61.5% LME CFR Mundra.
  
  
• Meatballs (20%) from Australia sold at $1,850/t.
  
  
• Copper high-grade cables from Australia were sold at 93% LME CFR Chennai.
  
  
• Copper mid-grade cables from Australia were sold at 91.5% LME CFR Chennai.
  
  
• Copper low-grade cables from Australia were sold at 87% LME CFR Chennai.
  
  
• Copper mixed motors from Australia were sold at $1,100/t.
  
  

Outlook

Copper prices in the local market are anticipated to remain strong in the near term, supported by the ongoing strike and potential changes in U.S. monetary policy, both of which could have a significant impact on the global copper market.