Domestic zinc prices were mixed across grades on Monday from a week ago. Some grades trended flat to up while zinc alloys dropped in line with the fall in primary zinc prices.
The official three-month LME zinc contract on Friday settled at $2996.5/mt, almost flat from a week ago, however, primary zinc prices were reduced in India in response to a slight drop on Sept 1 ($2,993.5/mt). Zinc prices traded under pressure as disappointing China manufacturing PMI data raised demand concerns. The slip in China’s industrial sector further hinted towards a slowdown in the largest metal-consuming economy.
The weekly Davis Index for zinc galvanizer’s dross in Delhi, Monday, settled at Rs199,190/mt ($2,728/mt) ex-works producer, up Rs1,907/mt driven by a rise in demand amid a tight supply of scrap. The Davis Index for zinc galvanizer’s dross in Mumbai settled at Rs205,000/mt ex-works producer, flat from a week ago as some galvanizers dropped offers in line with a drop in primary zinc prices. The disparity in offers was wide in Mumbai on Monday with offers ranging from Rs200,000-205,000/mt while in Delhi offers were even.
Markets for dross strengthened in both Mumbai and Delhi in terms of spreads as prices were up in a week with demand improving for the material. Despite a slip in LME, domestic prices improved. Furthermore, scrap shortages supported higher offers.
The weekly Davis Index for secondary zinc ingot on Monday for Delhi settled at Rs203,858/mt ex-works consumer, up by Rs1,825/mt. Demand from galvanizers for the secondary ingot was minimum in both Delhi and Mumbai. The Davis Index for secondary zinc ingot in Mumbai settled at Rs201,375/mt ex-works consumer, up by Rs50/mt. Offers were pushed up as Delhi prices rose while demand in Mumbai was scarce. Most galvanizers bought primary zinc instead of secondary zinc ingots.
The Davis Index for imported new zinc diecast settled at $2,441/mt cfr India port, up $88/mt driven by a jump in freight prices and scrap scarcity. Some booked material at $2,500/mt while some were bidding at $2,400-2,450/mt levels.
The weekly Davis Index for Zamak #3 on Monday settled at Rs252,890/mt del India consumer, down by Rs4,243/mt driven by a fall in raw material prices over the week. The Davis Index for Zamak #5 settled at Rs255,265/mt del India consumer, down by Rs4,368/mt from a week ago. Export orders have picked up slightly while domestic orders remain subdued. Markets weakened for the grade as demand continues to struggle, however, demand is expected to improve in the coming weeks.
In Delhi, market participants expect a jump in scrap prices in the coming days as supply tightness is expected to widen with demand increasing slowly and gradually.
($1=Rs73)