The weekly Davis Index for US new zinc diecast fell by 3¢/lb to 62¢/lb delivered US consumer on Thursday, as weakening demand and tight supply put a downward pressure on prices.
The index for zinc galvanizers bottom dross and zinc galvanizers top dross remained at 73¢/lb delivered US consumer and 68¢/lb delivered, respectively, as scrap yards across the country were either operating under reduced hours or temporarily shut down to contain COVID-19.
The automotive sector shutdowns, which include big carmakers as well as automotive part suppliers, have reduced demand for zinc galvanizers, which are used extensively in the auto manufacturing process.
However, suppliers are hopeful that material will begin moving again upon the resumption of vehicle manufacturing—most auto sector shutdowns are slated to end in either the middle or end of April. Market participants, especially smaller suppliers and peddlers, could also receive support from the additional measures announced by the Federal Reserve on Thursday to provide up to $2.3tn in loans, meant mostly for small- and medium-sized businesses.
The official three-months LME zinc contract closed on Thursday at $1,898.5/mt, up by $40/mt from $1,858.5/mt on April 2.