Page 65 from: April 2005
had to pay high prices to remain
competitive with other markets.
Lead & Zinc
The battery industry continues to
have difficulties in coming to terms
with high lead prices and this has
led to a recent slow-down in de-
mand. The region’s secondary lead
producers have experienced weaker
demand from markets in South East
Asia, as well as from India, but they
feel nevertheless that the market
should improve from April onwards
due to seasonal factors.
China’s exports of primary lead
were 11.8% higher this January com-
pared to the same month last year at
around 40 000 tonnes. Meanwhile,
the same country’s refined zinc ex-
ports increased by 9.6% in January to
17 000 tonnes. However, premiums
in Asia for special high-grade zinc
(SHGZ) are expected to increase over
the next few months owing to strong
demand as well as a possible reduc-
tion in exports from China due to
power shortages. Current SHGZ pre-
miums in Japan are around US$ 150-
170 per tonne on a cif basis.
Aluminium
The improvement in aluminium
prices has lured more scrap into the
marketplace, to the extent that some
customers have been attempting to
put a hold on deliveries of materials
that had already been bought. Faced
with higher raw material costs, how-
ever, ingot manufacturers have been
struggling to increases the sales
price of their own products.
Early in the second half of March,
mill purchases of UBCs were reported
to be particularly healthy at around
77 cents delivered. US exports of alu-
minium scrap traced a strongly up-
ward trend in the first month of this
year: overseas shipments were 33%
higher than in the same month last
year at 59 549 tonnes, with exports of
UBCs jumping 44% to 508 tonnes.
Copper
Although demand has been rela-
tively stable, excitement levels in the
copper scrap market have failed to
match expectations, not least because
of generally sporadic orders from the
Chinese. Copper cathode premiums
on the domestic market have fallen
slightly over the last month. Most
grades of brass scrap, meanwhile, are
enjoying good demand.
Forecasters remain somewhat di-
vided about the overall prospects for
the copper market in 2005. Among
the more optimistic analysts, Bar-
clays Capital argued recently that
the copper price could achieve a
peak as high as US$ 1.60 per lb
around the middle of the year. The
company’s researchers based this
prediction on, among other factors,
the impact of Chinese demand for
concentrates, refined metal and
scrap, global under-investment in
new supply, low inventory levels,
and increasing fund investment in-
terest in commodities.
Most analysts are anticipating a
deficit in the global copper market for
2005, although there is significant
disagreement on the likely scale of the
shortfall. Latest figures from the In-
ternational Copper Study Group con-
firm a refined metal deficit of 706 000
tonnes in 2004 compared to 386 000
tonnes in the previous year; US re-
fined copper consumption increased
by 5.5% last year – broadly in line with
2004 world consumption growth of
5.6%.
Lead & Zinc
Shortly before going to press, zinc
established its highest level in seven
and a half years with the LME cash
price hitting 64 cents per lb towards
the middle of March.
While predicting lower average
prices in the second quarter for most
of the mainstream non-ferrous met-
als, analyst Goldman Sachs is antici-
pating that the zinc average will rise
from 60 cents in the first quarter to
61 cents in the April-June period;
forecasts for the third and fourth
quarters are for average prices of,
respectively, 62 cents and 63.5 cents.
At the time of writing, lead stocks
were continuing to decline and prices
were gathering pace. With the global
lead market expected to be in deficit
this year, current price averages are
well above the expectations voiced to-
wards the start of the first quarter.
M A R K E T A N A L Y S I S
Contributing to the
Non-Ferrous
Metals Market Analysis:
* Ralf Schmitz, German
non-ferrous trade association
VDM (Europe)
* Kumar Radhakrishnan,
General Manager,
International Division of
Simsmetal Ltd, Australia
(Asia & Pacific Rim)
* Ian Martin, Recycling
International’s Editorial
Consultant (North America)
65
Zinc
LM
E
st
oc
ks
(x
1
00
0
m
et
ri
c
to
nn
es
)
600
550
650
700
750
800
900
1000
1100
1200
1300
1400
LM
E
pr
ic
es
(i
n
U
.S
. d
ol
la
rs
/M
T)
FEBRMAR MARAPR MAY AUG SEPT OCT NOV DEC JAN
Nickel
LM
E
st
oc
ks
(x
1
00
0
m
et
ri
c
to
nn
es
)
0
10
20
30
40
50
12.000
13.000
14.000
15.000
16.000
17.000
LM
E
pr
ic
es
(i
n
U
.S
. d
ol
la
rs
/M
T)
FEBRMAR MARAUG SEPT OCT NOV DEC JANAPR MAY
■ Non-ferrous metal scrap, stainless, nickel scraps…
■ Telecom relay, military and meter scraps
■ Cable, motors, transformer core, mixed metal scraps
■ HRC, CRG, GI/GL, PPGI, EG, CRGO, tinplate
■ Dismantled silicon steel, secondary grade steel coil, offcut
steel, reusable rail
■ PET, HDPET, LDPET, PS, PVC, Nylon, ABS…
North America
Attempts to delay deliveries
