US zinc scrap prices were rangebound for the third successive week as supply and demand for the material balanced in the domestic market.
The official LME Zinc three-month contract settled Thursday at $2,996/mt up by $63.50/mt from Aug 19. Still, spot deals remain low as traders await clearer direction from the market.
The weekly Davis Indexes for zinc galvanizers bottom dross and zinc galvanizers top dross remained unchanged at 99¢/lb delivered US consumer and $1.02/lb delivered, respectively, on Thursday.
New zinc diecast also trended flat at 97.5¢/lb delivered as demand from the automotive industry softened. US auto sales in August are also expected to trend down according to advance reports, which may put added pressure on raw material prices for materials like new zinc diecast.
In the primary market, the Davis Index special high-grade (SHG) premium remained unchanged at 8.4¢/lb delivered. A zinc deficit reported by the World Bureau of Metal Statistics in the first half of the year, along with rising demand, is likely to push SHG premiums higher starting next month, at least until the end of December. The fourth quarter is also historically a time when long-term premium contracts are negotiated, which typically lifts SHG zinc premiums and prices.
Overall, demand for zinc scrap has balanced with supply in the domestic market. With European smelters returning online this week, the demand for zinc scrap is strengthening in the export market, which could increase prices for domestic zinc scrap in September.