Weekly round up: Base metals prices slump amid bearish sentiments

The base metals market witnessed the bearish trends across regions in the global market. Concerns looming over China lockdowns, US Federal Reserve rate hikes, oil fluctuations, inflation, etc. weighed on the upstream and downstream industries.

Aluminium

Aluminium stocks continued to fall by 15,900 t to 570,100 t w-o-w at London Metal Exchange (LME)-registered warehouses. The domestic Indian base-metals market is influenced by LME exchange three-month prices and is largely linked with upstream industries where prices showed a downtrend w-o-w, SteelMint assessment shows.

Local smelters didn't had enough options except to pass on the higher cost as oil prices have risen twice in the past month but demand weakened in the domestic as well as overseas markets.

LME aluiminium cash prices were down by 6% w-o-w basis which led to corrections in domestic scrap prices. SteelMint's price assessment for aluminium tense scrap stood at INR 170,000/t ($2,221/t), falling down by INR 3,000/t ($39/t) w-o-w, exy-Delhi, whereas, ADC12 stood at INR 214,000/t ($2,796/t), exw-Faridabad, down by INR 2,000/t ($26/t) on a w-o-w basis.

Further, Middle East (ME)-origin aluminium scrap import prices decreased in the range of $60-90/t CIF Nhava Sheva on 29 April, as against 22 April 2022. UK-origin wheel scrap prices, too, saw a correction by $80/t w-o-w.

Notably, the key domestic players Balco and Hindalco lowered aluminium ingots prices by INR 16,750/t ($219/t) and INR 16,500/t ($216/t) on the week.

Nickel

Most of the market participants believe that raw-material imports into India are not likely to see any major contraction amid a limited workforce during Ramazan festival in the Middle East. However, shipments have been affected which may support prices in the near term. LME nickel prices drifted down around 4% this week which had major impact on domestic finished and scrap prices of stainless steel.

SteelMint's assessment of stainless-steel grade 304 scrap was recorded at INR 184,000/t ($2,404/t), down INR 5,000/t ($65/t) w-o-w, and grade 316 scrap at INR 282,000/t ($3,685/t), down by INR 7,000/t ($91/t) w-o-w, exy-Delhi.

Utensil scrap prices also corrected. Major stainless steel producers in north India corrected its prices upto INR 10,000/t. This correction was followed by Chinese domestic stainless steel price drop owing to low domestic demand due to Covid outbreak.

Copper

Copper prices, in terms of both cash and three-month contract,showed fluctuations. However, copper inventory was recorded at 156,050 t, up sharply by around 18,300 t from 137,775 t last week.

SteelMint's assessment for copper armature scrap exy-Delhi stood at INR 745,000/t ($9,735/t), down INR 8,000/t ($104/t) w-o-w.

Zinc

Zinc special high grade (SHG) ingots prices witnessed a correction by around 5% to INR 370,000/t ($4,835/t), exy-Delhi on 29 April 2022 w-o-w.

The drop in LME prices dragged down domestic Indian zinc prices. The market saw very few buying inquiries which also resulted in a fall in prices.

In addition, India's leading aluminium producer NALCO has scheduled an auction for the sale of 1,690 t scrap segregated aluminium dross from its smelter plant in Angul, Odisha on 12 May 2022. The quoted offer will be valid for 60 days from the date of the closing of the e-auction. The duration of the lifting of the material is two months from the date of issue of a delivery order.