Weekly round-up: Non-ferrous market shows mixed trend on volatile futures

Non-ferrous metals prices on the London Metal Exchange (LME) remained in volatile position this week. The market witnessed moderate transactions.

Stocks of all key non-ferrous metals like aluminium and zinc at LME-registered warehouses dropped by 3% and 4% w-o-w. However, copper was up by 20% to 91,975 t.

The dollar index, which measures the greenback's value against a basket of six different currencies, was at 103.19, up 0.48% compared to the last week.

Global market

In April 2023, unemployment rates were lower in 14 states, stable in 36 states and the District of Columbia, the U.S. Bureau of Labor Statistics reported. Sixteen states saw a decrease in jobless rates compared to the previous year, while 10 states experienced increases.

Over the year, non-farm payroll employment increased in 40 states and remained essentially unchanged in 10 states and the district. The national unemployment rate remained at 3.4% y-o-y, slightly lower than April 2022.

Domestic market overview

The domestic non-ferrous scrap market had mixed trends this week due to volatile future exchange markets and an uncertainty from various factors. Transactional activity was moderate, but demand remained weak as sellers are hoping for prices to rise soon.

Aluminium scrap trade remains moderate

Aluminium scrap prices in the domestic market fluctuated during the week due to significant variations in the exchange market. Additionally, a major price increase by primary players led to moderate trading activities. Consequently, buyers have become cautious and adopted a wait-and-watch approach to evaluate the situation before making decisions.

Tense prices stood at INR 162,000/t while utensil prices were at INR 174,000/t exy Delhi.

Domestic aluminium alloy ingot ADC12 prices remained firm w-o-w at INR 199,000/t exw-Faridabad this week. However, some sellers were even quoting higher prices but actual transactions were heard in the range of INR 198,000/t-200,000/t, post-discounts and concessions.

Global aluminum market

The market sentiment was uncertain, with buyers refraining from making firm bids and expressing caution by holding their bookings due to unclear price levels. However, they made prompt bookings for their immediate requirements. On the other hand, sellers opted to adopt a wait-and-watch strategy until the market became clearer.

Copper prices down

Domestic copper armature scrap prices edged down w-o-w to INR 682,000/t ($8,232/t) ex-Delhi. Meanwhile, secondary wire rod prices stood at INR 722,000/t ($8,175/t) ex-Delhi.

The supply of copper in the market remained sufficient throughout the week. However, sellers temporarily refrained from making offers due to an uncertainty in the futures market.

Despite the sluggish start to the week, the market gradually gained momentum, with buying inquiries for finished materials significantly increasing during the latter half of the week. Sellers are now anticipating a rise in prices as they aim to destock their inventory. This surge in demand has created a more competitive environment in the market, leading to a tougher and more challenging situation for sellers.

Zinc prices fall, lead rangebound

Prices of domestic special high-grade (SHG) zinc ingots fell by 4.5% w-o-w to close at INR 230,000/t ($2,936/t) exw-Delhi amid slow zinc futures. Prices of domestic remelted lead ingots remained largely stable. Refined lead ingots prices stood around INR 183,500/t, exw-Delhi.