Prices for zinc alloys increased by 3-4¢/lb as demand continued to outpace supply and orders from the automotive industry increased.
LME Zinc prices continued to trend up during the week with the official LME Zinc cash price settling Tuesday at $2,962/mt ($1.3435/lb) up by $27.50/mt from Jul 20.
Demand remains strong and producers are lagging on order fulfillment even as more bookings are finalized. Still, participants are keeping a close watch on how the government deals with the rising number of COVID-19 infections because of the Delta variant in the US. The consensus remains that a second round of shutdowns would be devastating not only to the zinc alloys market but to the US economy.
The weekly Davis Index for Zamak #2 rose by 3.4¢/lb to $1.594/lb delivered US consumer. Zamak #5 moved up by 3.7¢/lb to $1.576/lb delivered while both Zamak #3 and #7, climbed by the same amount to settle at $1.556/lb delivered.
Among the ZA grades, the Davis Index for ZA27 increased by 4.2¢/lb to $1.701/lb delivered while both ZA8 and ZA 12 rose by 3.2¢/lb to $1.601/lb and $1.631/lb delivered, respectively.
Orders from the automotive industry are increasing as more carmakers resume production in anticipation of the semiconductor chip supply easing August onwards. Demand from the construction and steel industry has kept zinc alloy producers busy through the first half with suppliers expecting the trend to continue in the second half of the year as well.