Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Domestic scrap prices across zinc grades inched up as Indian markets slightly improved this week. Demand from end-users recovered as some states eased COVID-19 restrictions. 


Scrap prices also moved in line with the uptick in LME zinc. On Friday, the official three-month LME zinc contract gained 1.06pc or $31.5/mt in a single day, which led to higher scrap prices. The LME contract, Friday, closed at $2,980/mt, up by $7/mt or 0.24pc higher from the prior week. Indexes across zinc grades rose between Rs90-180/mt in Delhi while Mumbai prices rose by Rs800-1,834/mt. Zinc alloy prices rose by Rs740-790/mt over the week. 


The weekly Davis Index for zinc galvanizer’s dross in Delhi on Monday settled at Rs193,667/mt ($2,590/mt) ex-works producer, up Rs180/mt in line with LME. The weekly Davis Index for zinc galvanizer’s dross for Mumbai settled at Rs200,317/mt ex-works producer, up Rs1,834/mt as demand stayed strong and offers were revised upwards. 


Markets for dross in Delhi weakened but Mumbai markets strengthened in terms of spreads. Mumbai is experiencing heavy rainfall which slows businesses down and might lead to supply constraints and support prices of scrap in the coming days. 


The weekly Davis Index for secondary zinc ingot, Monday, settled at Rs195,590/mt ex-works Delhi consumer, up by Rs90/mt from a week ago. Brass manufacturers are procuring secondary zinc ingot on a need basis and avoiding stocking as end-user demand is still soft. The Davis Index for secondary zinc ingot for Mumbai settled at Rs202,100/mt ex-works consumer, up by Rs800/mt from the preceding week. 


Secondary zinc ingot prices, Monday, weakened in terms of spreads as demand from brass manufacturers remains low and has not picked up as expected. Prices are on the higher end and several buyers are yet to re-enter the market as they wait for their end-user demand to pick up. 


The weekly Davis Index for new zinc diecast on Monday settled at $2,309/mt, up by $64/mt. Offers were revised in line with LME’s rise on increased global demand for zinc. Some offers heard around $2,300-2,350/mt on Monday. Demand from Indian buyers is slightly better said traders but still not as strong as expected. 


Zinc Alloys

Zinc alloy prices also moved up in the week as primary zinc prices rose by approximately Rs3,000/mt pushing zinc alloy prices up. The Davis Index for Zamak #3 on Monday settled at Rs255,290/mt del India consumer, up by Rs790/mt and the index for Zamak #5 settled at Rs258,240/mt del India consumer. 


Demand from the automotive and infrastructure sectors is expected to rise in the coming weeks, which could drive demand for alloys. The previous months were weak in terms of demand for Zamak, when domestic market was subdued but the export market was active. With demand from India recovering, overall demand for Zamak#3 and Zamak#5 is likely to improve in the coming days. 


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