Weekly round-up: Domestic base metals market mirrors global trends; nickel gains over 11%

At the end of trading on Friday, 17 May 2024, prices of all the base metals on the London Metal Exchange (LME) witnessed positive trends w-o-w.

On the LME, three-month aluminium futures increased by 3.2% to $2,612/t, while nickel settled at $21,080/t (up 11.39%). Copper prices were at $10,668/t, zinc rose 3.4% to $3,031/t and lead prices rose by 2.7% to $2,283/t.

Throughout the week, domestic base metals markets experienced price gains aligning with the global market trends. Imported and domestic aluminium scrap prices remained firm. Meanwhile, copper, zinc and lead prices saw notable gains in prices.

Aluminium

India's primary aluminium producers have increased aluminium P1020 primary ingot prices by up to INR 3,400/t, which in turn has slightly increased the P1020 ingot spot prices in Delhi NCR.

Aluminium scrap prices in India remained steady with slight fluctuations. Market activity is slow as buyers adopt a cautious stance. BigMint's assessment for, tense scrap from the US saw a minor $10/t rise, hitting $1,960/t, while UK-origin zorba 95/5 was priced at $2,170/t.

BigMint's assessment showed a weekly drop of INR 4,000/t for spot prices of aluminium ADC12 alloy ingot, reaching INR 212,000/t exw-Delhi NCR. Tense scrap prices fell by INR 2,000/t to INR 183,000/t ex-Delhi, resulting in a scrap-to-ADC12 spread of INR 29,000-30,000/t. Additionally, lower demand and cash flow disruptions were noticed due to elections.

Copper

BigMint reported a 1.2% weekly increase in domestic copper armature prices to INR 820,000/t ex-Delhi, paralleling LME's 2-year high at over $10,300/t. Secondary CCR rods rose by 1.7% to INR 875,000/t, while primary CC rods increased by 2.2% to INR 910,000/t.

Imported scrap surged by up to 4.8% w-o-w. Buyers, cautious of high futures prices, opted for local consumption until prices stabilise.

Additionally, China's copper cathode output saw a slight decrease in April due to maintenance, with more smelters scheduled for maintenance in May, affecting production and potentially leading to price hikes.

Zinc, lead

Domestic zinc and lead prices saw slight gains w-o-w amid an increase in LME futures as well as price hikes by HZL. Zinc ingot prices in Delhi rose to INR 272,000/t, up 1.1%. Re-melted lead prices stood at INR 189,000/t, ex-Delhi. Meanwhile, Middle East zinc diecast (5%) prices were at $2,135/t CFR Mundra.

Global updates

• BHP may improve its $43 billion offer for Anglo American, adding cash, after rejection; another bid expected before 22 May.
  
  
• Korea Zinc plans to increase copper production to 150,000 t by 2028, focusing on urban mining and US growth opportunities.
  
  
• U.S. factory production unexpectedly declined in April by 0.3%, primarily due to a drop in motor vehicle output. Manufacturing output fell by 0.5% y-o-y amid challenges posed by higher borrowing costs.