Weekly round-up: Prices edge lower in global, Indian base metals markets

The global base metals market witnessed a downtrend this week as far as prices of metals on the London Metal Exchange (LME) were concerned. Similarly, Indian base metals prices remained on the lower side this week.

Three-month aluminium futures on the LME dipped 1.8% to $2,199/t, while nickel decreased by 0.2% settling at $18,546/t. Copper prices fell by 1.2% to $7,949/t, while zinc dropped by 2.5% to 2,446/t and lead prices were down by 4.7% to $2,042/t.

Stock levels on LME warehouses witnessed mixed trends w-o-w.

The Indian base metals market was in line with the global market for the week. The domestic as well as imported aluminium market witnessed decline in prices. Furthermore, copper, zinc and lead prices faced a downturn w-o-w. Meanwhile, the trade activities remained moderate.

Aluminium

During the week, primary aluminium ingot (P1020) prices dropped as a result of price cuts by major primary players. SteelMint's assessment for aluminium ingot P1020 stood at INR 219,000/t exy-Delhi, excluding GST.

In the Indian aluminum alloy ingot market, prices decreased due to improved raw material availability and a $30-40/t drop in LME futures contracts. Casting scrap availability increased after weeks of scarcity. ADC12 prices fell w-o-w due to slow demand, with Honda settling at INR 203,300/t and MSIL at INR 197,250/t for October. ADC12 prices were at INR 186,000-187,000/t exw-Delhi, excluding GST.

The domestic aluminum scrap market in India experienced a lack of movement, with buyers showing limited interest and sellers avoiding price reductions, leading to a stagnant market condition.

The Indian imported aluminum scrap market has seen a downturn due to falling futures exchanges and weak domestic demand. Suppliers from Europe and the UK offered varied prices, leading to a cautious approach among buyers. Sales of finished materials are slow, and domestic alloy producers are operating at reduced capacity.

Copper

Copper prices in the domestic market witnessed marginal dip, with buyers exercising caution amid weak global demand, which is putting pressure on prices. Additionally, secondary rod and copper armature scrap prices saw a slight decrease of 0.4% w-o-w. Similarly, in the imported segment, the price of copper motor scrap originating from the US witnessed a 1% decline.

Zinc and lead

In India, zinc and lead prices experienced a minor weekly decrease, primarily due to price adjustments by HZL. Transaction activity remained limited. Middle East-origin zinc diecast (5%) was evaluated at $2,000/t CIF Mundra.

Tender updates

• Hindustan Aeronautics Limited is set to auction 52 t of aluminum scrap on 20 October, 2023.
  
  
• The Department of Defence Production in India has issued a procurement tender for approximately 190 tonnes of copper wire rods, with the tender set for 1 November, 2023.
  
  

Recent deals

• A recent deal for 40 t of lead soft cable from Australia was concluded at 3M(94%) CIF Chennai.
  
  
• Around 50 t, UK-origin TT scrap with 2% attachment sold at $1,650/t, CIF west coast.
  
  
• Around 200 t of extrusion scrap from Australia with 1% attachment sold at LME3M's 94%, CIF Chennai.
  
  
• 100 t UK-origin shredded TT with 1-2% attachment sold at $1,800/t, CIF Mundra.
  
  
• Around 80 t, Malaysia-origin aluminium talk traded at $4,260, CIF Mundra.
  
  
• A deal of 75 t of Middle east copper birch cliff was traded at 91% LME 3 month, CIF Mundra.
  
  

Global updates

• In August, India's industrial output surged at its fastest rate in over a year, with a 10.3% increase, driven by robust manufacturing, electricity, and mining activity.
  
  
• According to the Bureau of Labour Statistics U.S., In September, the U.S. CPI-U increased by 0.4%, led by higher shelter and gasoline costs.
  
  
• Malaysia's Industrial Production Index (IPI) in August 2023 fell by 0.3% y-o-y, mainly driven by a 0.6% contraction in the manufacturing sector.
  
  
• In September, Japan's Producer Price Index decreased by 0.3% compared to the previous month, while the Export Price Index increased by 0.5%, and the Import Price Index rose by 0.6%.
  
  
• China's consumer prices remained unchanged in September, missing the expected 0.2% gain, indicating persistent deflationary pressures.