Domestic base metals prices remained volatile this week following fluctuations in the three-month contract prices on the London Metal Exchange.
Currently, the Indian rupee depreciated against the US dollar to reach 79.89, close to the 80-mark again, while a sharp rise in crude oil prices kept the local currency under pressure leading to uncertainty in the global as well as domestic market.
Aluminium scrap import prices volatile
Imported aluminium scrap prices (from the UK and the Middle East) increased in the range of $20-45/t this week. On 23 August, the price of UK origin imported aluminium Zorba 95-5 scrap increased by $40/t to $1,755/t CFR Nhava Sheva. Trade channels reported that offers from overseas sellers were limited as procurement lowered amid tight domestic scrap availability in USA, UK and Middle East regions.
On the other hand, aluminium talk scrap saw a drop of $20/t to $4,400/t compared to prices on 16 Aug. Domestic scrap aluminium tense prices remained range bound at INR 151,000/t ($1,888/t) exy-Delhi.
Domestic copper prices move down marginally
Domestic copper armature scrap prices decreased slightly by 1.5% to INR 618,000/t ($7,728/t) w-o-w due to limited demand resulting in a minor correction in secondary wire rod prices w-o-w by 0.52% to INR 662,000/t ($8,278/t) despite a slight rise by 1.02% in LME’s three-month futures owing to a 2.67% decline in stock levels.
However primary wire rod prices moved up by 1.15% w-o-w. Market participants believe that stable supply-demand kept prices supported in the local market.
A global energy crisis centred in Europe, a slump in China, particularly the crucial property and construction sector, inflation and fears of a recession in the US and a surging dollar are attributed for all the gloom in the copper market.
Lead, zinc prices range bound
Domestic special high-grade (SHG) zinc ingot prices remained range bound at INR 328,000/t ($4,101/t) w-o-w. LME’s three-month zinc contract prices were up marginally by 2% this week.
Moreover, domestic remelted lead ingot prices remained within a tight range at INR 182,000/t ($2,276/t) exw-Delhi on 26 August. Primary lead ingot prices were recorded at INR 194,000/t ($2,426/t) exw-Delhi.
Smelters across Europe cut output
Supply and demand are imbalanced and being what they are, reduced gas from Russia caused energy prices to skyrocket all over the continent. This, in turn, forced multiple smelting operations to curb their overall output of energy-intensive metals.
Among the first commodities on the line, aluminum and zinc, both of these metals require vast amounts of electricity, and many smelters simply can’t afford them anymore and hence, decided to cut their output.
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