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

US zinc secondary alloy prices climbed by 3.9¢/lb on Tuesday after incurring losses last week, thanks to strong demand and a rising LME. 


The official LME Zinc cash offer closed Tuesday at $1.1356/lb, increasing from $1.100/lb on September 8, while the official three-month LME Zinc contract recovered from last week and closed Tuesday at $2,524.50/mt, up by $71.50/mt from $2,453/mt on September 8. 


Market participants are optimistic about medium-term trends, but, after last week’s declines across all base metals, they’re closely monitoring prices. LME Zinc prices are expected rise in the short-term, with some anticipating growth to around $2,580-2,600/mt in the next few weeks.


The weekly Davis Index increased by 3.9¢/lb for all Zamak grades. The index for Zamak #2 rose to $1.349/lb delivered US consumer on Tuesday, while Zamak #3 and Zamak #7 both increased to $1.319/lb delivered. Zamak #5 also increased to $1.334/lb delivered on Tuesday. 


The indexes for zinc alloys also rose by the same amount, with the indices for ZA 8 and ZA 27 increasing to $1.369/lb delivered US consumer and $1.409/lb delivered, respectively, on Tuesday. ZA 12 also increased to $1.389/lb delivered.


Producers are seeing some green shoots in the zinc alloys market, even though it’s volatile because Chinese industrial output is still in recovery and the country’s products are reshoring. Some producers told Davis Index that China and Peru reported record special high-grade (SHG) zinc production last month. 


However, with many industries that use SHG still reeling, producers are concerned about oversupply of the material impacting prices. Despite these fears, domestic production and demand remain robust, and producers don’t expect any significant short-term setbacks.


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