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

The weekly spreads for US domestic copper widened for some grades amid weak demand on Tuesday despite a correction in Comex copper prices this week.

The Comex copper spot market settled at $4.09/lb on Tuesday, down by 6¢/lb from Mar 16. The Comex copper market has fluctuated by 5-6¢/lb throughout the month after hitting record highs for the year in the first week of March.

The Davis Index spread for US bare bright copper scrap (barley) widened by 0.1¢/lb to 16.8¢/lb under the March Comex contract on Tuesday, with the transaction price for bare bright climbing by 5¢/lb to $3.983/lb delivered US consumer.

The spread for #1 copper wire & tube held unchanged at 27.5¢/lb under the March Comex contract, with the weekly transaction price for the grade dropping by 10.7¢/lb to $3.813/lb delivered.

The spread for #2 Light copper widened by 1.5¢/lb to 50.5¢/lb under the March Comex contract while the transaction price declined by 6.7¢/lb to $3.583/lb delivered US consumer.

Trade is drying up in the US domestic copper scrap market amid high freight costs and inadequate deliveries. Some market participants are seeing suppliers delaying their delivery dates to the second quarter of the year without much pressure from consumers hoping to get lower freight rates.

A potential shift in the export grading guidelines from China is expected to impact domestic spreads and prices of #2 copper, a grade that is preferred by Chinese importers. However, the US market has adopted a wait-and-see approach to gauge the impact of China’s specification changes for this grade.

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