Weekly round-up: Indian base metals prices witness mixed trends ahead of Diwali

The global base metals market witnessed uptrend this week barring nickel as far as prices on the London Metal Exchange (LME) were concerned. However, the Indian base metals prices displayed mixed trends.

Three-month aluminium futures on the LME inched up by 0.8% to $2,220/t, while nickel fell by 1.9% settling at $18,000/t. Copper prices gained 1.1% to $7,963/t, while zinc edged up by 1.2% to 2,445/t and lead prices were up by 0.6% to $2,141/t.

Similarly, LME warehouse stock levels displayed varying trends w-o-w. Lead stocks, in particular, experienced significant inflows, rising by 13.1% to reach 125,225 t.

Prices of base metals in India showed mixed trends over the week. Both domestic and imported aluminum experienced minor changes, while copper prices declined slightly compared to the previous week. Zinc prices saw a slight increase, and lead prices remained relatively stable. Additionally, trade activities were at a moderate level throughout the week.

Aluminium

During the week, primary aluminium ingot (P1020) prices gained as a result of price hikes by major primary players.

SteelMint's assessment for ADC12 alloy ingot prices this week stands at INR 184,000/t, while tense scrap prices in Delhi remained stable at INR 155,000/t due to subdued demand and ample supply.

India's aluminium scrap market remained steady w-o-w. Participants cited funding shortages, weak local demand, and global geopolitical uncertainties as concerns.

Indian imported aluminium scrap prices remained largely stable w-o-w with marginal fluctuations. This was due to limited buying and selling activities amid festive season. Buyers are offering lower bids. Finished material sales have been sluggish, impacting orders for alloy manufacturers.

Copper

The Indian copper market saw a decline attributed to the ongoing festive season and soft global demand. Many buyers have sufficient inventories, and market trends are expected to clarify after Diwali. Copper prices on MCX fell 1.3% to INR 693,000/t.

Meanwhile, the Adani Group's significant investment in copper refining capacity, with 500,000 t beginning production by March 2024, is set to impact trade dynamics, according to Miren Lodha, Director of CRISIL Market Intelligence & Analytics.

Prices of copper motor scrap of US origin stood at $1,070/t CIF Mundra, and sellers are prepared to provide discounts ranging from $30-$40/t. This willingness to provide discounts is a response to the lack of urgency among buyers.

Zinc and lead

Zinc and lead prices in India increased marginally w-o-w, influenced by price adjustments by HZL. Zinc ingots were assessed at INR 227,000/t, while re-melted lead ingots stood at INR 182,000/t exw-Delhi. The Middle East-origin zinc diecast (5%) was assessed at $1,935/t CIF Mundra. However, the market saw limited activity due to the festive season.

Recent deals

• Two containers of Europe-origin tense scrap (3-4%) were traded at a price of $1,600, CIF Mundra.
  
  
• A container of USA copper motor mix was sold at a price of $1,070, CIF Mundra.
  
  
• 85 t of Malaysia tense loose material was transacted at a price of $1,680, CIF Nhava Sheva.
  
  
• Vietnam-origin re-melted zinc ingots were sold at $2,480/t, CIF Mundra in opening of this week.
  
  

Global updates

• China's industrial profits continued to improve, rising by 11.9% y-o-y in September 2023.
  
  
• The US has suspended a 25% tariff on EU steel and a 10% tariff on EU aluminum.
  
  
• Germany Manufacturing Purchasing Managers' Index (PMI) reached a five-month high of 40.7 in October 2023.