Weekly round-up: Domestic, global base metal prices exhibit positive trends, lead stocks fall

At the close of trading on Friday, 23 August 2024, base metals prices on the London Metal Exchange (LME) showed positive trends. Aluminium recorded the largest gain, rising by 7.48%. Meanwhile, LME warehouse stocks exhibited mixed trends, with lead experiencing the highest outflow at 8.13%.

This week, the domestic market reflected global trends. Imported aluminum prices increased by 4%, and both copper and lead saw weekly gains. All base metals prices rebounded, supported by a recovery in futures prices. With growing market confidence and resumed trading activity following holidays, the outlook for base metals remains positive.

Aluminium

Imported market: Imported aluminium scrap prices in India moved up w-o-w amid the rebound in LME prices. Prices of all grades were up by up to $70/tonne (t) this week amidst resumed purchase enquiries after a long holiday week. According to BigMint's assessment, tense scrap from the Middle East, particularly the UAE, saw an increase of $50/t, settling at $1,780/t. Zorba 95/5 from the UK was up by $50/t to $2,000/t CFR west coast, India.

Domestic scrap: In the domestic market, tense scrap prices edged up w-o-w in both Delhi and Chennai. According to BigMint's assessment, domestic tense scrap prices stood at INR 177,000/t ex-Chennai. Market participants expect prices to move up in the near term.

Aluminium alloy: Spot prices of aluminium ADC12 alloy ingots (non-OEM) in Delhi NCR and Chennai increased by INR 1,000/t w-o-w, according to BigMint's latest assessment. In Delhi-NCR, ADC12 spot prices were assessed at INR 208,000/t ex-Delhi, aligning with domestic tense scrap prices, which settled at INR 176,000/t ex-Delhi.

Copper

Imported: 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. 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.

Domestic: Domestic copper armature scrap prices edged up to INR 735,000/t exy-Delhi. Meanwhile, copper prices on the LME rebounded by 1.89% to $9,288/t w-o-w. Secondary copper rod prices were at INR 785,000/t with few trades heard. In the imported segment, Mill berry offers from the US were at 99.25-99.5% CFR Mundra.

Zinc, lead

Domestic: India's domestic zinc prices increased by INR 5,000/t ($59/t). Lead remained stable w-o-w as compared to 16 August, 2024. Zinc prices were up by 2% to INR 275,000/t, aligning with a 4.8% rise in HZL prices and a 2.7% increase in LME prices. Domestic remelted lead was priced at INR 185,000/t, ex-Delhi. Middle East zinc diecast prices stood at $2,090/t CFR Mundra.

ILZSG shared early data showing a zinc surplus in the first half of calendar year 2024 (H1CY'24). Global stockpiles grew by 172,000 t while refined zinc supply exceeded demand by 282,000 t. ILZSG reported global supply of world refined lead metal in H1CY'24. The global supply exceeded demand by 15,000 t, leading to total reported inventories rising by 93,000 t in the H1CY'24

China base metals market overview

In the week ending 24 August 2024, deliverable stocks of base metals in Shanghai Futures Exchange (SHFE)-registered warehouses displayed mixed trends. Notably, lead saw a significant outflow, decreasing by over 60.9% w-o-w to reach 23,679 t, according to the exchange's weekly stocks report.

Global updates

BHP's return to Argentina sparks copper mining potential

BHP's $3.25 billion investment in Argentina, its first in two decades, signalled a renewed interest in the country's copper sector. The deal with Lundin Mining aims to develop two major copper mines.

Hindalco to invest $10 billion in expansion

Hindalco Industries plans to invest $10 billion to boost its aluminium and copper production, including Novelis' Bay Minnette project in the U.S. The expansion also includes a new copper facility in Gujarat. This move aims to enhance production capabilities and support electric vehicle cell components.