US zinc secondary alloys prices climbed by 1-2¢/lb on Tuesday on rising raw material costs and high LME Zinc prices.
LME Zinc cash offers rose on Tuesday to close at $1.39/lb up from $1.36/lb in the previous week, while the official three-month LME Zinc contract breached the $3,000/mt level earlier this week and increased by $56/mt from May 11 to close at $3,055/mt today.
The weekly Davis Index for Zamak #2 increased by 2¢/lb to $1.60/lb delivered US consumer with Zamak #3 and Zamak #7 rising by a penny to $1.56/lb delivered, respectively. Zamak #5 also climbed by 1¢/lb to $1.58/lb delivered.
ZA 8 remained unchanged at $1.61/lb delivered while ZA 12 increased by 1.5¢/lb to and $1.64/lb delivered. The index for ZA 27 climbed by 1¢/lb to $1.71/lb delivered on robust demand for the grade.
Demand for zinc alloys remains strong though buyers have begun questioning high prices for the alloys. Producers point to higher costs for procuring metals like copper, aluminum, and magnesium to support adding a higher premium to alloy prices.
Pent-up demand after the US economy reopened after COVID-19 related shutdowns have boosted zinc alloys prices so far, but as buyers fulfill their volumes, the question of justifying higher costs to end consumers looms over the market.