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

The Davis Index for new zinc diecast rose by $104/mt to $1,560/mt cfr India port on Monday from $1,456/mt cfr India port in the prior week. Prices were flat for almost eight weeks since the beginning of the lockdown on March 25. A rise in prices was supported by a global revival of demand with many downstream industries, including secondary zinc ingot makers resuming operations. 

 

Several recyclers and manufacturers consuming zinc scrap have begun operations this week and trades are likely to gain momentum soon. Though, importers are treading with caution before booking scrap in large quantities as the domestic market is yet to stabilise.  

 

The Davis Index for secondary zinc ingots settled flat at Rs159,700/mt ($2,102/mt) ex-works Mumbai consumer and Rs159,950/mt ex-works Delhi consumer, Monday, flat from the week prior. Thin trades were reported. In Mumbai, a COVID-19 hotspot, market players continued to face difficulties. Trade took place through direct contact. A similar situation persists in Delhi. In the capital city, some ingot producers could resume operations only on Sunday, May 17. These ingot producers though prioritised liquidation of their previous inventories.

 

Dross manufacturers faced similar circumstances. Galvanizers have slowly restarted production but significant trades are yet taken place. Traders are hoping for bookings to pick up by next week. Dross trades are being reported in cities with lesser COVID-19 cases. Before booking zinc scrap, manufacturers aim to clear their inventories at the earliest. Zinc oxide manufacturers hold enough dross inventories to meet their production requirements for a month.  

 

Thus, the demand for zinc could remain stagnant for the next few days. The Davis Index for galvanizer’s dross settledat Rs146,325/mt ex-works Mumbai producer on Monday, while the index for Delhi settled at Rs150,783/mt ex-works Delhi producer, both flat from the week prior. 

 

Though the lockdown has been officially extended till May 31, relaxation measures by the central and state governments kept the market sentiment positive. 

Zinc Alloy

The Davis Index for Zamak #3 settled flat at Rs170,533/mt del India consumer and the index for Zamak #5 settled at Rs174,033/mt del India consumer, also flat since the lockdown dated March 24. 

 

Few Zamak trades were heard. Though administrative operations resumed, manufacturing of new Zamak ingots remains halted.A few die-casters in non-containment zones have resumed operations but stayed away from Zamak trades. With most auto ancillaries operational, Zamak producers are hoping for demand to pick up in the coming weeks. In Maharashtra, most Zamak producers have restarted operations. 

 

Primary zinc manufactures in India have decreased prices by Rs4,800/mt on May 18 for Special High-Grade zinc (SHG) to approximately Rs173,700/mt from the prior Monday. Primary manufactures follow the official three-month LME zinc contract which fell by $57/mt to $1,945/mt (Rs4,330/mt) on Friday from the prior week. Zamak prices also are likely to fall across India as primary zinc is used as a raw material to produce Zamak.

 

($1=Rs75.96)

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