Weekly round-up: India's base metal market reflects global trends with mixed price movements
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London Metal Exchange (LME) base metal prices exhibited a varied trend for the week, with most futures experiencing either minimal changes or declines throughout the week. This occurred against the backdrop of subdued global economic indicators, contributing to a lack of significant market momentum.
In LME, three-month aluminium futures dropped by 2.3% to $2,166/tonne (t), while nickel settled at $16,036/t (down by 1.8%). Copper prices were at $8,351/t, zinc dipped by 2.07% to $2,462/t and lead prices gained marginally by 0.6% to $2,105/t.
LME-registered warehouse stocks displayed varied trends, notably with lead witnessing the most significant outflow, decreasing by approximately 6.2% w-o-w.
The Indian non-ferrous metals segment followed the global cues for the week witnessing mixed trends. As per BigMint's assessment, imported and domestic aluminium market prices witnessed fluctuations. Copper and zinc prices slipped, lead prices maintained stability.
Trade activities in the market had improved for the week. However, the increase in sea freight charges after the Red Sea crisis led to lower booking interest from the buyers' end.
Aluminium
During the week, primary aluminium ingot (P1020) prices dropped in the spot market, followed by price cuts by major primary players.
BigMint's assessment for aluminium ADC12 alloy ingot in Delhi remained stable at INR 190,000/t amid range-bound tense prices. The spread between tense and ADC12 was INR 31,000/t. Tight scrap availability persisted domestically, while global scrap prices saw fluctuations. Additionally, the price of Silicon 553 of Chinese-origin has decreased w-o-w to $2,140/t, down by $10/t.
Meanwhile, India's automobile exports faced a 21% decline in 2023, totalling 42,85,809 units compared to 52,04,966 in 2022, according to Siam data.
India's imported aluminum scrap market remained volatile, influenced by falling LME futures. Despite rising freight rates, moderate transactions persist as market participants maintain minimal stock levels. Shifting dynamics led to a preference for Middle East and Far East sources.
In India, domestic aluminum scrap prices displayed varied trends. Tense scrap at INR 160,000/t (up 1%) had positive market sentiment with active buying. Utensil scrap, dropped due to limited demand in the northern market.
Copper
India's domestic copper market witnessed slight decline in prices. Armature prices stood at INR 665,000/t and secondary rods prices were at INR 705,000/t, both ex-Delhi.
In the imported segment, scrap prices remained range-bound w-o-w. Mixed motor scrap prices from the US was firm at $1,145/t. Middle East-origin brass honey scrap prices gained by 0.8%, as per BigMint's assessment.
The MCX saw a 0.1% weekly decline in copper prices, settling at INR 718,000/t. Global copper prices on COMEX gained by 1% to $8,315/t.
Codelco, the world's largest copper producer, reported a decline in copper output by 6.8% y-o-y for the last quarter of 2023, reaching 358,000 t.
Zinc and lead
India's zinc prices witnessed a 1.2% w-o-w decline, on decreased market demand due to seasonal effect. Meanwhile, HZL zinc prices saw a marginal increase, leaving the market unaffected. Remelted lead ingot prices remained stable at INR 177,000/t, exw-Delhi, as per BigMint's assessment.
In the imported segment, Middle East zinc diecast (5%) rose by 1% to $1,945/t, CIF Mundra. However, trades were not workable at these levels.
Recent deals
A recent deal for 100 t of UK-origin copper cable was heard at 3M (91%), CFR West Coast, India.
Around 120 t of UK Wheel was sold at $2,150/t, CFR West Coast, India.
A deal for 25 t of Indonesia origin refined lead was traded at $2,175/t, CFR Mundra.
Early this week, around 20 t of tense (70-30) was concluded at $1,770/t, CFR Mundra.
Around 10 t of copper primary CC rod was heard to be concluded at INR 728,000/t, Exw-Delhi.
Global updates
China's Q4 2023 GDP grew by 5.2%, while full-year GDP growth was 5.2%, compared to 3% in 2022.
The Chilean Copper Commission (Cochilco) has adjusted its copper price forecast for 2024, now projecting an average of 385 cents, up from the previous estimate of 375 cents made on 23 September.
In Q4 2023, Rio Tinto reported a 15% q-o-q increase in bauxite production, an 8% rise in aluminium production and a 5% increase in mined copper production to 0.16 mnt.
