Weekly round-up: Indian non-ferrous metals prices exhibit mixed trend

The global base metals market witnessed a mixed trend this week as far as prices of metals on the London Metal Exchange (LME) were concerned. On the other hand, Indian base metals prices displayed a downtrend w-o-w.

Three-month aluminium futures on the LME rose 2.3% to $2,240/t, while nickel decreased by 2.5% settling at $19,418/t. Copper prices fell by 2.2% to $8,222/t, while zinc rose by 1.7% to 2,562/t. Lead prices were down by 2.1% to $2,214/t.

Stock levels on LME warehouses witnessed fluctuations w-o-w. Interestingly, lead stocks surged w-o-w to 74,300 t (up 37.3%) from 54,100 t last week.

The Indian base metals market exhibited mixed performance last week, largely in line with global market trends. The domestic aluminium market witnessed a decline in prices, whereas the imported market saw a slight uptick. Furthermore, copper and zinc markets faced a downturn, although the lead market observed marginal price hike.

Aluminium

Despite a slight increase in futures, the domestic aluminium scrap market witnessed a marginal w-o-w decline in prices. Market participants shared that bearish demand and slower market activities were on account of festive celebrations during the week. Notably, tense scrap prices settled at INR 155,000/t, while utensil prices reached INR 173,000/t, both ex-works Delhi (excluding GST).

Indian imported aluminium scrap prices decreased slightly on limited transactions. Countries in the Far East are actively purchasing due to limited raw material availability in Europe, leading to reduced trade activity in India. Furthermore, limited market liquidity is posing a challenge for buyers in making additional bookings.

Copper

Domestic buyers are prioritising immediate needs, resulting in the postponement of most bookings. Secondary rod prices are at INR 702,000/t, and copper armature at INR 665,000/t both ex-Delhi, down w-o-w. However, buyers are preparing for a price hike on rising demand ahead of the festive season.

In the imported scrap segment, prices of copper motor scrap originating from the US were recently assessed at $1,135/t CIF Mundra, up $15/t w-o-w.

Zinc and lead

Zinc prices dipped 1.7% w-o-w to INR 229,000/t majorly influenced by reduced market activity amid festive celebrations and HZL's price fluctuations. As regards imported scrap, zinc diecast (5%) from the Middle East was stable at $2,060/t CIF Mundra. Meanwhile, the lead prices rose slightly by 0.5% w-o-w to INR 203,000/t, ex-Delhi.

Deals

• Around 100 t Saudi Arabia-origin aluminium trump with 10% attachment was sold at $1,710/t CIF Klang.
  
  
• 100 t of EU-origin Zorba 98/3 was traded at $1,850/t CIF Klang.
  
  
• Around 100 t trump with 10% attachment of UAE-origin was sold at $1,710/t CIF Damaiyu.
  
  
• Ghana-origin 100 t trump with 10% attachment was heard sold at $1,690/t CIF Klang.
  
  

Macroeconomic developments

US industrial production: In August, industrial production in the US edged up by 0.4%. However, the manufacturing sector was hindered by a 5% decline in motor vehicles production. On the positive side, mining increased by 1.4%, and utilities saw a 0.9% growth. Overall, total production showed a modest 0.2% y-o-y increase.

China's economic performance: China, under the guidance of the CPC Central Committee, prioritised stability and high-quality development in August. Notably, industrial production grew by 4.5%, services by 6.8%, and retail sales by 4.6% y-o-y. The manufacturing sector, especially equipment manufacturing, exhibited strong growth.

Japan's manufacturing challenges: In September, Japan's manufacturing activity faced its fourth consecutive month of contraction, with the au Jibun Bank's projected Japan Manufacturing Purchasing Managers' Index (PMI) falling to 48.6. New orders declined significantly, and input price inflation reached a four-month high, indicating rising cost pressures for manufacturers.