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

The Davis Index for secondary zinc ingots remained flat at Rs159,700/mt ($2,108/mt) ex-works Mumbai consumer and Rs159,950/mt ex-works Delhi consumer, Monday, flat from the week prior as no trades took place. 


Some smelting plants have resumed operations, but no transactions were reported as most of the downstream consumers of zinc scrap and ingots have built up inventories. Smelter operations have begun but production remains halted in some regions of the country. In Mumbai, smelters are still shut and so are end-use consumers as COVID-19 cases continue to rise.


Resumption in auto dealerships could push up retail vehicle sales. Zinc dross market is awaiting for demand improvement in the auto and tyre sector. Prices of zinc dross remained flat with the weekly Davis Index for galvanizer’s dross settling at Rs146,325/mt ex-works Mumbai producer on Monday, while the index for Delhi settled at Rs150,783/mt ex-works Delhi producer flat from the week prior as markets remained closed.


Several major tyre producers like Ceat and JK Tyres have re-started operations and consequently major zinc oxide producers are also in process of resuming operations. Tyre manufacturers are the biggest consumers of zinc oxide and more than 60pc of zinc oxide is supplied to them.


Other sectors consuming zinc oxide including ceramics, paints, fertilizers have also started to resume production slowly. Paint companies like Asian Paints have recently resumed partial operations at its manufacturing locations where restrictions were eased. Gradually, demand for zinc dross is likely to increase. Galvanizers continue to remain shut in Mumbai, while in Delhi, resumption of operations is likely to take place by end of the week. Price direction is, however, unknown and is expected to be clear by May 17 post lockdown. 


Importers have started clearing pending contracts after collecting their stuck consignments from the respective ports. Logistics have slightly eased in the country helping importers to conclude their deals, however, no new imports were recorded as demand remains sluggish and uncertain amid COVID-19 lockdown. The Davis Index for new zinc diecast settled flat at $1,456/mt cfr India port Monday from the week prior. 


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, flat since the lockdown dated March 24. 


No Zamak trades were recorded either but some producers have resumed operations but manufacture of new Zamak ingots remains halted. Some die-casters in non-red zones have restarted operations said traders. Most auto ancillaries are now operational and Zamak producers are expecting a spike in demand in the coming weeks. 


Primary zinc manufactures in India have started operating and have revised their prices for the first time since March 19. As on May 11, Special High Grade zinc (SHG) was at approximately Rs177,500/mt up by Rs12,800/mt from March 19. Primary manufactures rely on official three-month LME zinc contract which is up $157/mt (Rs11,887/mt) since March 19 and prices of primary zinc are in line with the same. 


Most Zamak producers would also raise prices in tune with primary zinc producers as prices of SHG increases their raw material input cost for production of Zamak. Demand from die-casters, however, would also play a part in pricing.


(1 USD = Rs75.73)

Leave a Reply

Your email address will not be published.