LME base metals prices show mixed picture with downside bias

• Sulfur shortage disrupts copper & nickel supply chains
  
  
• IEA proposes Iraq-Turkiye pipeline to bypass Hormuz, diversify supply
  
  

Base metals on the London Metal Exchange (LME) traded mostly lower on a d-o-d basis on 17 April 2026, with declines seen across key metals, while a few posted modest gains. Aluminium recorded the sharpest drop, falling 2.17% to $3,565/t, followed by nickel, which slipped 0.67% to $18,117/t. In contrast, zinc rose 0.64% to $3,446/t, copper gained 0.58% to $13,347/t, and lead increased 0.49% to $1,962/t.

On the inventory side, trends were mixed but largely indicated drawdowns in stocks. Zinc inventories saw the steepest decline, down 1.48% to 114,750 t. Aluminium stocks decreased 0.53% to 391,675 t, copper stocks fell 0.23% to 401,700 t, and lead inventories edged lower by 0.13% to 275,625 t. Meanwhile, nickel stocks recorded a marginal increase of 0.04% to 278,184 t, suggesting relatively stable availability compared to other metals

Domestic market overview

India's non-ferrous scrap markets remained largely stable on a d-o-d basis, with aluminium prices unchanged while copper registered a decline. Aluminium tense scrap (loose), ex-Delhi, held flat at INR 290,000/t, showing no change from the previous level. Similarly, ex-Chennai prices remained stable at INR 307,000/t, indicating balanced market conditions with no immediate price movement.

In contrast, copper armature scrap (Cu 99%), ex-Delhi, declined by INR 9,000/t or 0.8% to INR 1,136,000/t from INR 1,145,000/t, reflecting weaker demand and downward price pressure in the copper segment.

Other market updates

Sulfur disruption impacts copper & nickel

The Iran conflict is extending beyond energy markets, triggering a sulfur shortage that is disrupting copper and nickel supply chains. Sulfur-critical for producing sulfuric acid used in copper SX-EW and nickel HPAL processing-has seen tightened availability due to stranded shipments via the Strait of Hormuz.

Additional pressure from China's sulfuric acid export restrictions, along with curbs in Turkiye and potential limits from India, has further inflated processing costs. Indonesian nickel production, in particular, is seeing cost increases of around $4,000/t.

Overall, the disruption underscores a cascading impact from energy to metals, supporting a bullish outlook for copper and nickel.

Japan auto sector hit by aluminium shortage

Japan's automotive sector is facing supply disruptions due to a sharp aluminium shortage triggered by the Iran conflict and Strait of Hormuz disruptions. The Middle East, a key aluminium supplier, has seen output and shipment constraints, tightening availability for Japanese manufacturers.

The shortage is forcing automakers to reassess production schedules and secure alternative supply sources, amid rising premiums and global competition for non-sanctioned metal.

Overall, the situation highlights how energy-driven geopolitical disruptions are cascading into downstream industries, with the auto sector emerging as a key demand-side casualty of tightening aluminium supply.

Strait of Hormuz disruption deepens supply concerns

The continued closure of the Strait of Hormuz-handling around 20% of global oil flows-has intensified supply-side risks, with no immediate signs of reopening amid ongoing geopolitical tensions.

Physical markets remain tight despite mixed signals in futures. Asian fuel cracks have surged sharply, with Singapore jet fuel prices exceeding near $200/bbl and gasoil up around 59%, reflecting acute supply constraints.

Crude trade flows into Asia have declined, though India has partially mitigated the impact via higher Russian imports. Prolonged disruption raises risks of refinery run cuts and sustained imbalance in global energy markets.

IEA pushes for Iraq-Turkiye pipeline to bypass Hormuz

Amid ongoing disruptions in the Strait of Hormuz, the IEA has proposed a pipeline linking Iraq's Basra fields to Turkey's Ceyhan terminal to reduce reliance on the chokepoint.

With around 90% of Iraq's oil exports routed via Hormuz, the project is being positioned as a strategic energy security measure, especially for Europe.

The move highlights a broader shift toward diversifying supply routes to mitigate geopolitical and logistical risks.

EU trade surplus shrinks sharply on US tariffs

The European Union's trade surplus contracted by 60% in February, primarily driven by a steep decline in exports to the United States amid ongoing tariff pressures. Exports to the US dropped 26.4% y-o-y, reflecting the impact of around 15% import tariffs on EU goods.

Overall EU exports fell 9.3%, while imports declined 3.5%, indicating a broader slowdown in trade activity. The sharp drop also reflects a high base effect, as exporters had front-loaded shipments in early 2025 ahead of tariff implementation.

Despite some resilience in select sectors, the data highlights weakening transatlantic trade momentum and rising pressure on EU export competitiveness amid evolving global trade policies.