Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Lead grades remained flat to up Wednesday from the prior week with a slight uptick in scrap prices. Ingots prices were flat this week. Domestic prices have remained on similar levels for three successive weeks as demand failed to influence prices. On Tuesday LME lead three-month official contract gained 3.32pc or $59/mt at 1,837.5/mt from a week ago. 



The Davis Index for lead batteries (drained) in Delhi rose Wednesday by Rs167/mt and settled at Rs80,000/mt ($1,089/mt) del consumer from the prior week. Offers were not raised in line with LME lead gains as subdued demand kept prices in check. Demand from smelters remained low Wednesday compared to the prior week. Smelters in Delhi said that demand is not a concern because seasonally this month is slightly low and sales might pick up in the coming months driven by auto sector’s demand. The Davis Index for secondary lead ingot in Delhi settled at Rs144,500/mt ex-works producer flat from the previous week. 


Markets for both lead scrap and ingots weakened this week in terms of spreads. For lead batteries (drained) spreads widened by 1.92pc compared to prior week and spreads for secondary lead ingot narrowed by 3.70pc from the prior week. In the one-week period, LME lead gained 3.32pc and with domestic prices almost unchanged from the previous week, markets deteriorated.



In Mumbai too markets-maintained status quo and ingot prices remained unchanged for three successive weeks. The Davis Index for secondary lead ingot settled flat at Rs142,000/mt ex-works consumer from the prior week. Smelters said there is nothing significant happening in the market as it has reached an equilibrium state and this will change when strong demand takes over. 


The Davis Index for lead batteries (drained) on Wednesday settled at Rs 79,938/mt del consumer, up by Rs271/mt from previous Wednesday. Mumbai is forecast to receive heavy rains this week which could affect power supply and logistics and delays trades. 


Subdued demand is pressuring scrap prices and not letting it rise in sync with LME lead. Bids from battery makers are on the lower side and the smelters are obligated to sell their material at the fixed price set by the market to reduce inventories. The market situation can, however, change if LME lead posts significant gains and demand improves.


Markets in terms of spread has weakened in the week in Mumbai. Spreads for scrap battery widened by 1.84pc and narrowed for ingots by 3.64pc from the previous week. Davis Index was flat to up in the week for both ingots and scrap, while LME lead was up 3.32pc. 


Primary lead ingot traded at Rs157,400/mt on Monday, down by Rs1,200/mt from the previous week. Prices almost certainly move in line with LME lead and could be revised upwards as LME gains driven by high demand from China, said industry participants. 



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