Weekly round-up: Non-ferrous metals prices drop on declining LME futures

Non-ferrous metals prices on the London Metal Exchange (LME) remained on a downward trend throughout this week. The market moved at a slower pace and witnessed moderate transactions.

Stocks of aluminum and lead went up marginally by 1% while zinc dropped by 5% w-o-w at LME-registered warehouses. However, copper was up 12% to 75,950 t.

The dollar index, which measures the greenback's value against a basket of six different currencies, was at 102.71, up 1.4% compared to last week.

Global market

The U.S. Bureau of Labor Statistics reported that the seasonally adjusted Producer Price Index for final demand rose by 0.2% in April. In March, prices fell by 0.4% and remained unchanged in February. Over the 12-month period ending in April, the unadjusted index for final demand increased by 2.3%.

The surge in copper production in Peru has had a significant impact on the global copper market, leading to a drop in prices on the LME. Following the announcement of the increase in copper production, prices on the LME fell by over 3% to below $8,500/t levels.

Domestic market overview

The domestic non-ferrous scrap market showed sluggish trends this week due to prices dropping at futures exchange markets and uncertainty induced by various factors. As a result, sellers have become increasingly cautious, adopting a wait-and-watch approach to assess the situation before taking positions.

Aluminium scrap prices drop

The market was slow with moderate trade being witnessed. Falling futures along with price cuts by major players impacted selling interest. LME futures dropped by over $100/t w-o-w.

Tense scrap prices stood at INR 162,000/t ($1,969/t) while utensil prices were at INR 172,000/t ($2,091/t).

Domestic prices of aluminium alloy ingot ADC12 fell by INR 1,000/t to INR 199,000/t w-o-w. The drop in prices can be attributed to moderate transactions. Additionally, prices of aluminium futures on the LME declined.

Recently, Maruti Suzuki released settlement prices for aluminium ADC12 alloy ingots for May. According to sources, prices fell by INR 2,000/t m-o-m to INR 207,400/t.

Global aluminium market

The price of imported aluminium scrap into India increased marginally w-o-w, compared to last week.

Copper prices down

Domestic copper armature scrap prices dropped sharply w-o-w to INR 688,000/t ($8,364/t) ex-Delhi. Meanwhile, secondary wire rod prices stood at INR 722,000/t ($8,779/t) ex-Delhi.

Demand and inquiries for primary rods were good but domestic scrap prices fell w-o-w as a result of declining LME futures. Overall, slow demand persisted in the both domestic and international markets.

Zinc prices drop, lead firm

Prices of domestic special high-grade (SHG) zinc ingots fell by 2% w-o-w to close at INR 236,000/t ($2,869/t) exw-Delhi amid slow futures. Prices of domestic remelted lead ingots remained firm. Meanwhile, refined lead ingots prices also remained almost firm w-o-w.