The weekly indexes for brass scrap rose by $20-75/mt in Delhi and Jamnagar, in sync with the jump in the three-month LME copper contract. Market participants reported weak demand due to strict lockdown in several parts of India. The lockdown in national capital Delhi has almost halted trades, while a slowdown in demand has hampered business sentiment in Jamnagar. Only those units having confirmed export orders for brass parts are operating, the rest have idled production.
Both, domestic and imported scrap prices increased due to the rise in LME copper. The three-month LME copper contract rose $64.5/mt to $9,959.5/mt on May 4 from $9,894/mt on April 27. In the week before this, LME copper jumped by $504/mt to $9,894/mt on April 27 from $9,390/mt on April 20. Participants are waiting for a correction in the three-month copper contract before booking new import orders.
Demand in North India remained weak as Delhi and the adjoining area saw a sharp spike in COVID-19 cases, causing concerns among workers and industry participants. Most scrap yards and smelters are operating at 10-15pc capacity in response to weak demand and shortage of laborers. Though China actively bought in the last few weeks, importers noted that it has now reduced buying.
The weekly Davis Index for imported Honey brass, Wednesday, rose Rs1,500/mt ($20.28/mt) to settle at Rs433,000/mt del Delhi consumer while in Jamnagar, the index settled at Rs446,833/mt del consumer, up by Rs5,583/mt ($75.51/mt). Jamnagar is facing a scarcity of raw material amid delay in shipments from Europe, drop in imports, and weak demand from domestic industries, other than the medical sector.
Smelters expect prices to rise amid a shortage of imported scrap in the market. Some downstream manufacturers reported an increase in demand for brass nozzles used in oxygen cylinders; and nuts, sockets, and control valves used in ventilators, which is expected to support prices. Chinese bids remained flat at $5,600/mt cfr China port but trades at this price were not possible considering the steep hike in the prices of imported scrap material.
The weekly Davis Index for Honey domestic origin (Purja) settled at Rs420,000/mt from Rs415,000/mt del Delhi consumer, up by Rs5,000. The weekly Index for Honey domestic origin (Vilayati) del Jamnagar consumer settled at Rs423,333/mt from Rs420,375/mt, up Rs2,958/mt due to high offers.