Prices for US zinc scrap trended sideways to slightly down on Thursday after the LME Zinc market gave up some of its gains from last week.
The three-month official LME Zinc contract closed on Thursday at $2,516/mt, down $41/mt from $2,557/mt on Oct 22, as hopes of the economic stimulus bill being passed before the US presidential elections waned.
The weekly Davis Index for new zinc diecast made up its losses from last week, rising by 0.3¢/lb to 75.5¢/lb delivered US consumer amid adequate supply and slightly higher demand.
Prices for both dross grades inched down by 0.1¢/lb as bidding for annual contracts for these grades began earlier in the week. The index for galvanizers bottom dross declined to 76.6¢/lb delivered US consumer, while galvanizers top dross continued its sideways pattern and fell to 74¢/lb delivered on Thursday.
Market participants estimated that zinc galvanizers top dross contracts are being negotiated at around 86-88pc of the current prices, but are likely to change by the end of the negotiating period. However, factors such as the outcome of the US presidential election, slowdown in global smelter activity and lower concentrate production in zinc importing destinations like China could affect prices moving forward.
The index for special high-grade zinc premium also ticked down by 0.1¢/lb to 8.5¢/lb under the three-month LME Zinc contract. Market participants expect premiums to move up further in January as demand for zinc continues to grow, with some forecasting the LME Zinc market to make up for its recent losses by January.