Weekly round-up: Domestic, global base metals prices exhibit negative trends

At the close of trading on Friday, 6 September 2024, base metals prices on the London Metal Exchange (LME) showed negative trends. Zinc recorded the largest drop in prices, declining by 6.21%. Meanwhile, LME warehouse stocks exhibited outflows, except for nickel, which experienced a gain of 2.28%.

On the LME, three-month aluminium futures fell by 4.29% to $2,342/tonne (t), and nickel prices were down by 5.21%, settling at $15,893/t. Copper prices were at $8,996/t, down by 2.59%; zinc decreased to $2,717/t; and lead fell by 4.38% to $1,963/t.

Additionally, India's base metals production displayed positive trends m-o-m in July 2024. Aluminium production inched up by 3%, followed by zinc with a 2% increase. Lead production increased by 11%, and copper cathode production increased by 24%.

This week, the domestic and global base metals markets experienced negative trends. Domestic aluminium scrap prices witnessed a downtrend, though imported aluminium prices increased by up to 3% despite a drop in LME aluminium. Meanwhile, copper, zinc and lead prices decreased w-o-w.

Aluminium

Imported market: Imported aluminium scrap prices in India drifted higher w-o-w despite a drop in LME aluminium prices. Meanwhile, transactional activities remained on the lower side due to significant bid-offer disparities seen in the market. According to BigMint's benchmark assessments, tense from the UAE was priced at $1,830/t, up 0.8% w-o-w, while zorba 95/5 from the UK was assessed at $2,080/t, both CFR west coast, India.

Domestic scrap market: In the domestic market, tense scrap prices inched down w-o-w in both Delhi and Chennai. According to BigMint's assessment, domestic tense scrap prices were at INR 176,500/t ex-Delhi-NCR and INR 177,500/t ex-Chennai.

Aluminium ADC12 (auto OEM-approved): In India, automotive OEM-approved ADC12 prices slightly decreased m-o-m for September 2024 deliveries. BigMint's monthly assessment shows that prices in Delhi-NCR are INR 218,000/t, while Chennai rates are INR 216,000/t.

Aluminium ADC12 (non-OEM): Spot prices of aluminium ADC12 alloy ingots (non-OEM) in Delhi-NCR and Chennai decreased by INR 1,500/t w-o-w. As per BigMint's benchmark assessments, prices of the ADC12 (non-OEM) grade stood at INR 208,500/t in Delhi and INR 210,500/t in Chennai.

Copper

Imported: According to BigMint's assessments, brass honey scrap originating from the Middle East stood at $5,860/t CFR Mundra. Similarly, copper mix motor scrap from the US stood at $1,150/t CFR Mundra. Imported scrap prices dropped by up to 4% w-o-w, mirroring the decline in LME copper prices.

In July 2024, India's imports of refined copper cathodes soared by 173% m-o-m, jumping to 26,571 t from 9,720 t in June. This sharp increase highlights the country's escalating demand and reliance on copper cathodes. India's imports of copper pipes and tubes stood at 8,859 t in July 2024, an increase of 11% m-o-m from 7,976 t in June 2024.

Domestic: Domestic copper armature scrap prices dropped to INR 723,500/t exy-Delhi. Meanwhile, secondary copper rod prices were at INR 775,000/t.

Zinc, lead

Domestic: India's domestic zinc prices slid by INR 9,000/t ($107/t). Lead remained stable w-o-w as compared to 30 August 2024. Zinc prices were down by 3% to INR 266,000/t, with a 3% decline in HZL prices and a 4.29% decrease in LME prices. Domestic remelted lead was priced at INR 186,000/t ex-Delhi.

Imported: Middle East zinc diecast prices stood at $2,095/t CFR Mundra, dropping by 1.2%.

China base metals market overview

In the week ending 6 September 2024, deliverable base metals stocks in the warehouses registered with the Shanghai Futures Exchange (SHFE) displayed negative trends, except for lead, which saw a rise of 18% w-o-w, according to the exchange's weekly stocks report.

Global updates

Harmony targets copper production by 2028

Harmony Gold aims to start copper production from its Eva Copper project in Queensland by 2028. The new mine, anticipated to produce up to 60,000 t of copper annually, marks a significant shift from the company's primary focus of gold. Despite a record profit and a $700 million funding reserve, Harmony's share price fell 10% due to forecasts of lower gold output and higher costs.

China's aluminium surge sparks trade tensions

China's aluminium production reached a record 3.69 million tonnes (mnt) in July, driven by surplus capacity. With domestic demand faltering, China has ramped up exports of semi-manufactured aluminium products. This flood has intensified trade disputes, especially with the US, which has imposed multiple tariffs but still saw 210,000 t of Chinese aluminium imports last year.