US zinc scrap prices reversed two weeks of declines to record increases amid a rising LME zinc market.
The three-month official LME zinc contract stemmed some of its losses from the end of January and closed Thursday at $2,746.50/mt up by $125.50/mt from Feb 4. LME prices began rising last week after breaching their lowest level since October 2020. Still, increasing zinc inventories in warehouses remain a concern and continue to test sentiment.
In scrap markets, galvanizer grades increased by around 5¢/lb this week. The weekly Davis Index for zinc galvanizers bottom dross rose by 5.2¢/lb to 73.5/lb delivered US consumer. Zinc galvanizers top dross climbed by the same amount to 70.5¢/lb delivered. Demand remains steady and some buyers have now locked in supply through the end of the month.
The weekly Davis Index for new zinc diecast increased by 4.4¢/lb to 78.7¢/lb delivered US consumer as demand from the automotive sector remained robust despite the semiconductor shortage related shutdowns last week.
Still, auto plant shutdowns remain a concern, especially after General Motors announced on Thursday that it planned to extend the shutdown of three plants in North America until mid-March.
In primary markets, the Davis Index special high-grade zinc premium held unchanged at 8.1¢/lb.