Weekly round-up: Domestic base metals prices edge down tracking decline in futures

At close of trading on Friday, 19 July 2024, prices of base metals on the London Metal Exchange (LME) witnessed a downtrend.

On LME, three-month aluminium futures fell by 4.5% to $2,312/t, while nickel prices settled at $16,105/t. Copper prices were at $9,214/t; zinc fell by 5.3% to $2,717/t and lead prices fell by 1.36% to $2,100/t.

This week, domestic and global base metals markets witnessed a downtrend. Domestic aluminium scrap prices fell marginally w-o-w. However, imported aluminium prices saw a rise ahead of the EU holidays.

Aluminium

According to BigMint's assessment, tense scrap from the Middle East, particularly the UAE, settled at $1,870/t and zorba 95/5 from the UK at $2,040/t CFR west coast, India.

Prices of US tense (6-7%) are assessed at $1,930/t CFR Mundra. However, suppliers were heard offering at $1,980/t levels and buyers' bids remained lower by $50-$60/t.

Japanese aluminium buyers have agreed to pay two global producers a premium of $172/t for July to September shipments, up 18% from the previous quarter, sources said. This is higher than the $145-$148/t paid in April-June but lower than initial offers of $175-$190. These premiums set the regional benchmark over the LME cash price.

ADC12

Spot prices of aluminium ADC12 alloy ingots (non-OEM) in Delhi NCR and Chennai remained rangebound w-o-w, with just a marginal drop seen, as per BigMint's latest assessment. In the Delhi-NCR region, ADC12 spot prices were assessed at INR 212,000/t ex-Delhi, aligning with domestic Tense scrap prices, which settled at INR 180,000/t ex-Delhi.

Likewise, ADC12 prices in Chennai were reported at INR 214,500/t on immediate payment basis, excluding GST. At the same time, casting scrap prices were at INR 181,000/t ex-Chennai.

Major automaker adjusts ADC12 prices

India's top automobile manufacturer has set ADC12 August settlement prices at INR 222,000/t, reflecting a modest reduction of INR 1,000/t from the previous month's INR 223,000/t. Although OEMs had anticipated a decrease of INR 2,000 to INR 3,000/t for August settlement, prices have shown resilience with only minor adjustments. This stability is noteworthy despite the decrease in raw material and LME aluminium prices.

Copper

BigMint reported a downfall of 1% in domestic copper armature prices to INR 762,000/t ex-Delhi, as LME's price levels drifted lower to $9,214/t. Secondary CCR rods prices remained at INR 808,000/t, while primary CC rods prices were at INR 835,000/t.

In the imported segment, copper motor mix originating from the US witnessed a 0.8% decrease and brass honey (5%) from the UAE fell by 0.9% w-o-w amid correction in LME copper prices.

Zinc, lead

Zinc ingots are at INR 273,000/t, down by 2.5% w-o-w. Meanwhile, lead ingots prices have remained almost stable at INR 189,000/t exw-Delhi. Meanwhile, Middle East zinc diecast (5%) prices were assessed at $2,160/t CFR Mundra.

China market

In the week ending on 20 July, deliverable stocks of base metals in Shanghai Futures Exchange (SHFE)-registered warehouses experienced declines, however aluminium witnessed the gain over 1% w-o-w reaching 265,822 t, as per the exchange's weekly stocks report.

The highest outflow of was seen in lead, the lead stocks was seen declining from Jiangsu warehouse this week, reaching 8,584 t.