Weekly round-up: Domestic base metals market witnesses negative trends amid weak demand
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At the close of trading on Friday, 11 October 2024, base metals prices on the London Metal Exchange (LME) showed negative trends. Lead recorded the largest drop in terms of prices, decreasing by 2.4%. Meanwhile, LME warehouse stocks exhibited negative trends, except nickel which rose 0.4%.
On the LME, three-month aluminium futures decreased by 0.77% to $2,633/tonne (t), and nickel prices were down by 0.71%, settling at $17,864/t. Copper prices were at $9,791/t, down by 1.53%, while zinc increased by 0.38% to $3,154/t. Lead fell by 2.42% to $2,097/t.
The domestic base metal market experienced weak demand this week due to the festive season of Navratri and Dussehra. Many market participants were absent, resulting in only partial market activity. Consequently, transactional activities remained low throughout the week.
Aluminium
Imported scrap: Imported aluminium scrap offers into India increased by up to 4% w-o-w. Offers increased because aluminium prices on the London Metal Exchange (LME) hit a 4-month high recently, following the Federal Reserve's rate cuts and China's new monetary stimulus and support for the property market.
BigMint's benchmark assessments showed that tense from the UAE was priced at $1,780/t, down by 1.1% w-o-w, while zorba 95/5 from the UK was at $2,100/t, both CFR west coast, India.
Aluminium ADC12: Domestic spot prices of aluminium ADC12 alloyed ingots were range-bound w-o-w, with a marginal decrease, in both the northern and southern regions of the country, pressured by weak demand and stable domestic raw material costs.
BigMint's benchmark assessments for ADC12 (non-OEM) grade stood at INR 206,000/tonne (t) in Delhi and INR 208,000/t in Chennai, down INR 1,000/t w-o-w.
A prominent automobile manufacturer has announced its ADC12 prices for Nov'24 settlements at INR 209,900/t, reflecting a reduction of INR 6,000/t from October's price of INR 215,900/t. This marks the lowest price level seen in eight months, with the last similar figure recorded in Mar'24.
Domestic copper armature prices were assessed at INR 750,000/tonne ex-Delhi, a decrease of 3% w-o-w, while imported scrap prices decreased by up to 2% w-o-w. The downfall in prices comes in the wake of copper futures on the London Metal Exchange (LME) slowing down after hitting a three-month high recently.
BigMint's assessments shows copper motor mix USA origin was recorded at $1,170/t CFR Mundra, down 1.7% w-o-w.
The Indian government has initiated a review of the countervailing duty (CVD) on imports of continuous cast copper wire rod from Indonesia, Malaysia, Thailand, and Vietnam, originally imposed in January 2020. The duty has been extended by the CBIC (Central Board of Indirect Taxes and Customs) until 7 July, 2025 to protect the domestic industry from subsidised imports.
Zinc, lead
India's domestic zinc and lead ingot prices fell by up to INR 1,700/t ($20/t) w-o-w, following a 4% drop in LME futures. Hindustan Zinc Limited's (HZL) prices also decreased for zinc and lead by 1%. Zinc prices stood at INR 286,000/t ($3,401/t), while demand remained firm.
Global updates
Japanese aluminium premium records 3rd consecutive quarterly rise for Q4'24 shipment
Some Japanese aluminium buyers have reportedly agreed to a shipment premium of $175/t over the LME benchmark price for the fourth quarter of 2024 which is 1.7% higher compared to the current quarter until 30 September
Japan: Copper strip demand faces uncertainty amid slowdown in auto
Copper strip production in FY2024 has increased by 5% to 97,249 tonnes, recovering from last year's declines. However, demand from key sectors like automobiles and semiconductors remains uncertain. Companies like Mitsubishi Materials and Kobe Steel are cautiously revising forecasts, with automotive demand showing signs of recovery but still sluggish overall.
Canada to enforce aluminium and steel tariffs on China
Canada will impose tariff surcharges on aluminium and steel imports from China, starting 22 October 2024. Deputy Prime Minister Chrystia Freeland stated that the move aims to protect Canadian workers and industries from China's trade practices.
